ILPT Secures $1.2B for Industrial Portfolio
The collection includes more than 100 properties spread across the U.S.
Industrial Logistics Properties Trust has landed $1.2 billion in refinancing for a 101-property industrial portfolio located in mainland U.S. and Hawaii.
Bank of America, Citibank, Bank of Montreal, Morgan Stanley Mortgage Capital Holdings, Royal Bank of Canada and UBS AG New York Branch provided the financing. The closing of the five-year, interest-only, fixed-rate mortgage is expected later this month.
The more than 100-asset collection is spread several states, including Arizona, Florida, Utah, Alabama, Maryland, Illinois, Colorado, Nebraska and Ohio, among others. More than half of the properties range between 35,530 and 645,000 square feet.
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ILPT will use the proceeds and $75 million of cash in hand to fully repay the CMBS loan of more than $1.2 billion that had its maturity date set in October 2025. Citibank originated the note in September 2022, with Wilmington Trust as trustee and Berkadia Commercial Mortgage as master servicer, CommercialEdge information shows.
The new loan will reduce the company’s interest expense by decreasing the amount of debt outstanding, as well as convert the owned debt to fixed rates and eliminate interest rate cap requirements for this tranche of debt.
Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to ILPT, while Dechert LLP represented the lender.
Industrial demand remains high
Demand for industrial real estate remains high, despite the current uncertainty caused by tariffs, which could lead to an increase in construction costs.
As of April, the national construction pipeline totaled 352.9 million square feet, accounting for 1.7 percent of inventory, according to a recent CommercialEdge report. National in-place rents for industrial space averaged $8.5 per square foot, rising 6.7 percent over the past 12 months, while the vacancy rate clocked in at 8.8 percent, up 30 basis points month-over-month.
Several refinancing deals recently closed in the sector. A few days ago, a Bridge Investment Group subsidiary obtained $354.6 million from Invesco Commercial Real Estate Finance Trust Inc. to refinance a 2.5 million-square-foot portfolio of industrial assets.
And last week, GFH Partners and Scannell Properties refinanced a 2.3 million-square-foot industrial portfolio in seven U.S. states with a $250 million single-asset, single-borrower CMBS loan. Barclays led the lending syndicate.
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