Bridge Buys Inland Empire Warehouse for $174M

Bridge Logistics Properties has acquired a 1.1 million-square-foot asset in Fontana, Calif., within the Inland Empire. The asset commanded $174 million in one of the market’s largest deals of the year, Commercial Observer first reported.

Scuderia Development previously owned the property, according to Yardi Matrix information. It purchased the property for nearly $51 million in 2009, just three years after the warehouse had come online.

Bridge paid almost $158 per square foot for the asset, above the national average reported by Yardi Matrix’s latest report, which stood at $142 per square foot in September, but below the market’s average tag of $234 per square foot.

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Investors pursued deals for small-to-medium assets across the Inland Empire, with the average size of a traded property landing at nearly 122,000 square feet during the first nine months, Yardi Matrix shows.

The market’s industrial investment volume totaled $1.2 billion during the same timeframe, marking a sizeable 24.8 percent decrease year-over-year, the same source reveals. Meanwhile, rent premiums went up 7.6 percent year-over-year to an average of $11.65 per square foot in September, while the vacancy rate clocked in at 7.7 percent, 180 basis points below the national figure.

Another similar, large deal that closed this year was Fortress Investment Group’s acquisition of a nearly 1.2 million-square-foot industrial campus for $208.8 million, Yardi Matrix information reveals. UPS sold the two-building park in January.

Bridge was likewise active in the market. This July, it paid $83.5 million for a 332,793-square-foot, three-building campus in the same city of Fontana. Hillwood sold the properties, which had only just debuted two years ago.

A soon-to-be vacant, 1.1 million-square-foot warehouse

Bridge’s newly acquired property is set to turn vacant at the start of next year, and plans call for building upgrades for lease-up readiness. The current tenant roster includes Cubework, a flexible warehousing solutions provider. What’s more, the building is part of a larger, 4.8 million-square-foot industrial campus that spans 202 acres, including 14 facilities.

The firm expects the need for large warehouses of more than 1 million square feet to pick back up as demand for high-quality properties outpaces available supply, according to a company statement. Featuring a cross-dock layout, the facility comprises 220 dock doors and 274 trailer stalls, in addition to truck courts measuring 185 feet.

Located at 10681 Production Ave., the warehouse is approximately 5 miles away from Bridge’s previous Fontana acquisition in July. Interstate 10 and a Union Pacific Intermodal Facility are within roughly 1 mile. Downtown San Bernardino is about 16 miles east.