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Sac County industrial properties part of $425 million portfolio sale


As part of a portfolio deal totaling more than $400 million, a handful of Sacramento region industrial properties are now owned by Orange county ­based BKM Capital Partners.

An industrial property at 9931 Horn Road in Sacramento County, seen here, is part of the Capitol Industrial Center, recently bought by Orange County based BKM Capital Partners in a portfolio deal of more than $400 million.

The local properties - 9828, 9912, 9940, and 9960 Business Park Drive and 9901-9981 Horn Road - were part of a Northern California portion of the portfolio deal, described as worth $124.2 million. Other Northern California properties in the deal were in Concord and Dublin; BKM did not break out the specific prices of each individual property.

"Our expertise is acquiring and improving value-add light multi-tenant industrial properties in key markets throughout the western part of the country;' said Brett Turner, BKM Capital Partners' managing director for acquisitions, in an email. "Each of these properties matches that criteria and is well-positioned to generate targeted returns for our investors."

Combined, the two local properties have over 335,773 square feet of industrial, office and flexible space, according to BKM's website, where they 're called Capitol Industrial Center. The Horn Road properties, with 48 spaces, are 97.3% occupied, according to Turner, while those on Business Park Drive have 33 spaces and are 90% leased. "With limited competition for smaller-sized units in this submarket and no competitive development, this asset is ideally positioned for success," Turner said of the Horn Road property. "We will implement rebranding with paint, landscaping and signage to maximize value;' he said.

Both properties are in unincorporated Sacramento County, west of the Rancho Cordova city limits.

Business Park Drive's spaces are currently renting for 13% below market, Turner said, giving his firm an opportunity to boost their value through cosmetic upgrades and then match rents to the market.

BKM, based in Newport Beach, sees Sacramento as a region on the upswing that fits a company strategy of investing in markets with strong growth potential and stable distribution infrastructure, he said.

Many of these markets, Sacramento included, serve as last-mile distribution hubs for e-commerce tenants, which are largely responsible for the industrial sector's expansion over the last decade, he said.

Singapore-based GLP was the seller in the portfolio transaction, which covered 11 properties in three states: Arizona, California and Oregon. The total purchase price was $425.4 million, with three of the properties bought in partnership with the Canyon Catalyst Fund, a vehicle of the California Public Employees' Retirement System and managed by Canyon Partners Real Estate.

GLP did not respond to an inquiry about the sale this week.

The purchase was BKM's second in the Sacramento region in recent years. In 2018, the firm bought 1761-1791 Tribute Road, known as Expo Centre, in Sacramento's Point West area for $10.1 million.

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BKM CAPITAL PARTNERS

 

Headquartered in Newport Beach, California, BKM Capital Partners is a real estate fund manager specializing in the acquisition and improvement of value-add multi-tenant industrial properties in metro areas across the Western U.S. Combining a deep knowledge of this niche industrial product type with in-house capabilities including on-site property management, asset management, and leasing to reposition and institutionalize light industrial assets, the firm continues to build on its proven track record, generating strong results with high levels of transparency and engagement for investors. 

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BKM MANAGEMENT COMPANY

 

BKM Management Company manages a portfolio of 8.7 million square feet of multi-tenant industrial properties for BKM Capital Partner’s private and institutional investors. With a focus on “boots on the ground” execution at the property level, BKM has in-house capabilities for both property management and leasing. The teams at the property level are focused on ensuring the tenants thrive and that the properties managed in the most efficient way.

 

 

 

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