CIP Real Estate Scoops Up Multitenant Industrial Park in All-Cash Deal
By Katie Burke, CoStar News
January 22, 2021
A Southern California investor is adding some more fuel to the East Bay industrial sector’s re with an all-cash deal to scoop up a Hayward, California, warehouse complex.
CIP Real Estate is shelling out $33 million for the Cabot Business Park, a more than 140,000-square-foot industrial campus with approximately 50 tenant suites. The deal equates to almost $236 per square foot, higher than the market’s current $215-a-foot average, according to CoStar data.
Thanks to accelerating e-commerce sales and a growing pool of tenants looking for central warehouse space, the East Bay industrial market has been a hotbed of activity among investors eager to plant their stake in the resilient sector. Buyers from BentallGreenOak to Morgan Stanley have closed on a series of deals over the past couple of years that have buoyed the market, which is the Bay Area’s largest industrial sector by far with more than 269 million square feet of inventory.
Pricing for East Bay industrial assets has climbed by more than 80% over the past ve years, according to CoStar data. The market is among the top 10 most expensive in the country.
With the property’s location, surrounded by the region’s arterial thoroughfares, and its high occupancy rate, CIP said it knew it had to go the extra mile in order to snap up the Hayward industrial asset.
“There is high demand in the multi-tenant industrial market, and the acquisition of Cabot Business Park will add strong value to our Bay Area industrial portfolio,” CIP Real Estate CEO Eric Smyth said in a statement. “These types of smaller ex [and] industrial parks rarely come available to purchase, particularly of this quality and location, so we acted quickly to secure the property.”
The four-building business park — located at 3777 Depot Road, 23575 Cabot Blvd., 23785 Cabot Blvd. and 23595 Cabot Blvd. — was last sold in mid-2017 to industrial real estate investor BKM Capital Partners for $18.05 million, according to CoStar data.
In the more than three years since, BKM has invested in renovations such as HVAC improvements, roong and other infrastructure upgrades. CIP said it plans to invest another $600,000 in immediate capital expenditures such as converting some of the larger units to “smaller, more marketable suites.”
The property is 90% occupied to a slew of logistics and manufacturing tenants such as SGS North America, Forensic Analytical Sciences, Seika Machinery and Fastenal.