By Jon Peterson
The Northern California regional office for Duke Realty in San Francisco has acquired the 109,594 square foot cold storage industrial asset in Richmond located at 2041 Factory Street. The purchase price was $32.5 million, or $296.5 per square foot, according to sources that track the sale of industrial assets in the East Bay.
Duke Realty did confirm that the publicly-traded REIT acquired the property, but it would not make any other comments on the purchase of the asset at this time.
The seller of the building was Los Angeles-based Dedeaux Properties, who worked with CBRE as its listing agent on the sale. Among those involved in the sale were Darla Longo, vice chairman, and Rebecca Perlmutter, senior vice president of the company’s National Partners West Coast Team, along with Bob Ferraro, a senior vice president with CBRE in its Oakland office. CBRE declined to comment when contacted for this story.
The sales price on the property has produced a 5.3 percent cap rate. This return is based on the property having a year-one net operating income of $1.71 million.
The property is now 100 percent leased to HelloFresh, a meal-kit delivery company. The asset is located on around 7.6 acres with 33 percent coverage. This means that the new owner of the property could expand the building by roughly another 46,364 square feet.
Dedeaux had originally put up for sale the property in Richmond along with another cold-storage/light food processing asset in San Jose. The Silicon Valley asset is located at 1130-1170 Olinder Court, which is now marketed for sale as a single property.
The San Jose property totals 64,594 square feet. It has a year-one net operating income of $1.05 million. The asset is 100 percent leased to Sun Basket, which also is a food delivery tenant.
Duke Realty owns three industrial buildings in Northern California totaling 1.9 million square feet, according to its first quarter 2019 earnings supplemental report. The REIT has no vacancies in these properties.