Sacramento Industrial Market Continues to Attract Major Industrial Buyers with Four Deals in Q4’21 Totaling $164.4MM

24493 Clawiter Road Hayward Bay Area Duke Realty Prologis CBRE CEVA
Photo by Marcin Jozwiak on Unsplash

By Jon Peterson

The Sacramento industrial market has remained a strong investment market for major institutional capital with four acquisitions that closed in the fourth quarter of 2021 totaling $164.4 million, as stated by Cushman & Wakefield in its fourth-quarter of 2021 report on the Sacramento industrial market.

The largest of the acquisitions for the quarter was the $91.9 million, or just around $505 per square foot, purchase made by the ElmTree Funds for the property located at 3620 Ramos Drive in West Sacramento. The property totals 182,000 square feet and was sold by NorthPoint Development.

ElmTree Funds is a St. Louis-based investment firm focused on buying net-leased properties throughout the United States. Last fall, the manager had a final closing on ElmTree U.S. Net Lease Fund IV where it raised $888 million. At the time of the closing, it had around $2.5 billion of immediate investment capacity.

Another very sizable transaction to close in the fourth quarter was TA Realty’s $36.9 million acquisition of an asset located at 1701 West National Drive in Sacramento. The 209,376 square foot asset was bought for $176 per square foot, and the seller was NTT Global Data Centers.

The other two sales were both approaching $18 million. One of these was the LBA Logistics’ $17.9 million purchase of 3100 52nd Avenue in Sacramento. The price per square foot was $112, based on the building size of 159,683 square feet. The seller was United States Cold Storage. The other sale was STAG Industrial paying $17.7 million, or $136 per square foot, to acquire the 130,158 square foot property located at 8440 Florin Road in Sacramento. The seller was Tesco Controls.

The overall Sacramento industrial market remains very tight. The vacancy in the fourth quarter fell by 40 basis points to 3.5 percent and has dropped by 210 basis points on a year-to-year basis, according to Cushman & Wakefield. The market will be seeing a significant amount of new construction coming to the market over the next couple of years, since there is 8.4 million square feet of product either under construction now or planned for the future.

West Coast Commercial Real Estate News