USAA Real Estate Announces 25-Asset Industrial Portfolio Recapitalization

By Liviu Oltean, Associate Editor

USAA Real Estate Co. announced the recapitalization of an industrial portfolio totaling more than 14 million square feet. The portfolio included 25 industrial assets scattered across 11 states as well as two excess land parcels.

The Tennessee- and Mississippi-based assets included in the portfolio were:

• The 789,291-square-foot Summit Distribution Center II in Memphis, Tenn.
• The 575,000-square-foot Rockdale Distribution Center II in Mt. Juliet, Tenn.
• The 450,000-square-foot Mid-South Logistec Center in La Vergne, Tenn.
• The 454, 272-square-foot Marathon in Southaven, Miss.
• The 257,976-square-foot Stateline C in Southaven, Miss.
• The 241,164-square-foot Stateline A in Southaven, Miss.
• The 784,440-square-foot Stateline D in Southaven, Miss.
• The 409, 176-square-foot Stateline E in Southaven, Miss.

According to an official press statement, the recapitalization entailed the sale of interests. The acquisition price was set by a bidding process, but remained undisclosed. A RealCo affiliate will retain a 10 percent ownership stake in the portfolio, whereas RealCo itself will serve as an advisor. In addition, as part of the recapitalization, the portfolio obtained  $185 million in debt financing from Prudential, which was secured by 10 assets totaling more than 5.9 million square feet.

“This is an exemplary transaction for RealCo –one of the most important and successful in our history –as it encapsulates our dedication to and excellence in creating value for our investors,” said Len O’Donnell, President & CEO of USAA RealCo. “With its collection of young, state of the art, well-balanced assets, this is one of the country’s largest and highest quality industrial portfolios. By adhering to our disciplined investment approach, we delivered extraordinary results for our investors while satisfying the market’s strong demand for high-caliber industrial assets.”