Private Buyer Pays $31.9MM for FedEx Industrial Building in Roseville

By Jon Peterson

A non-disclosed private buyer has paid $31.9 million and $160 per square foot to buy the 198,774 square foot industrial building in Roseville that is leased to FedEx, as stated by sources with direct knowledge of the transaction.

The seller of the property was Eagle Property Group, an affiliate of Tratt Properties based in Phoenix. This company was represented in the transaction by CBRE, whose efforts were led by Darla Longo, vice chairman/managing director, and Rebecca Perlmutter, senior vice president. CBRE declined to comment when contacted for this story.

The cap rate on this transaction was 5.43 percent. This rate is based on the property’s net operating income for the next year. The cap rate is somewhat higher than what a similar project may yield in the East Bay, but it makes the distinction between the industrial market like Sacramento and the East Bay obvious in that regard.

The asset in Roseville is located at 8051 Foothills Boulevard, in the northern part of the city. It is part of the Industrial Area East neighborhood, and it is adjacent to Hewlett Packard Enterprise location and TSI Semiconductors, according to Google Maps. It was developed as a build-to-suit complex for the FedEx Ground Package System, a wholly-owned subsidiary of the FedEx Corporation. This tenant has a lease that runs through November 2028. FedEx Ground operates its small package delivery system out of this property. The tenant has invested $15 million, or $75 per square foot, of its own capital into the property.

The industrial market in Roseville remains very tight with strong rental rate growth. The entire industrial market in Roseville has a vacancy of 3 percent, with it falling to 1.7 percent for A and B quality distribution buildings. During 2017, the rental rate growth in the market was 13.3 percent and much of this was caused by very little new construction

West Coast Commercial Real Estate News