BentallGreenOak Buys 1 MSF Warehouse

The purchase marks the company's second industrial acquisition in a key Atlanta submarket this year.

BentallGreenOak has expanded its industrial presence in metropolitan Atlanta with the recent acquisition of 355 Horace Head Road, a 1 million-square-foot bulk distribution warehouse in Jefferson, Ga. The global real estate investment management advisor purchased the vacant property from its developer, a joint venture between MetLife Investment Management and Panattoni Development Co. Inc., in a transaction valued at $78.7 million.

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Located off Dry Pond Road in Northeast Atlanta’s I-85 corridor, 355 Horace Head delivered as a speculative development in the third quarter of 2020, marking the completion of the only big-box product in metropolitan Atlanta for the quarter. Investors continue to “flock to the sector” in Atlanta, as noted in a third quarter 2021 report by JLL, so landing a state-of-the-art property primed for lease-up is no simple feat.

“Institutional investors are now clearly viewing Atlanta as a tier one industrial market, resulting in a highly competitive buying market that has driven up pricing and tightened returns,” Joseph Paskov, vice president, Investments, with BentallGreenOak, told Commercial Property Executive. “We have sought alternative means of investing in the market by taking on calculated risk in exchange for returns we feel are commensurate for those risks.”

355 Horace Head Road, Jefferson, Ga.
355 Horace Head Road, Jefferson, Ga. Image courtesy of NAI Brannen Goddard

Currently, 355 Horace Head holds the distinction of being the only existing vacant warehouse of 1 million square feet or greater in metropolitan Atlanta. The cross-dock facility, originally named Jefferson Logistics Center by its development team, offers a host of coveted features ranging from 36-foot clear heights to two speculative office pods totaling roughly 3,200 square feet.

The purchase of 355 Horace Head constitutes BentallGreenOak’s second industrial acquisition in the Atlanta market in 2021. The company has good reason for expanding its position in the area.

“Atlanta is a top six market nationally in terms of gross industrial product and has been experiencing strong underlying fundamentals that have driven record leasing activity,” noted Paskov. “The city’s centralized location within the Southeast, educated workforce stemming from quality colleges and universities, and world-class international airport have led to outsized population growth and a diversified economy that continues to expand year over year.”

Eyes wide open

BentallGreenOak has been making strides in increasing its logistics holdings in 2021. The company commenced the year with the $73.5 million purchase of North Bay Logistics Center, an approximately 607,200-square-foot facility in Fairfield, Calif., in the San Francisco Bay Area. And in one of the top-five U.S. industrial transactions in the first five months of 2021, BentallGreenOak acquired the 853,500-square-foot Mid-Atlantic Commerce Center just outside Baltimore in Jessup, Md., for $125 million.

“We are bullish on major metro areas with strong population growth and diversified economies,” Paskov said of the company’s acquisition strategy. “The expansion of e-commerce has highlighted the importance of distribution channels, and as a result well-connected interstate systems and high-capacity airports are key attributes to consider.”

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