Alterra, ConGlobal Partner on Outdoor Storage Portfolio

Alterra IOS has partnered with ConGlobal Industries, North America’s leading operator of intermodal, finished vehicle and depot service terminals, to acquire four industrial outdoor storage properties totaling nearly 90 acres with more than 50,000 square feet of buildings in a sale-leaseback transaction.

ConGlobal, which has operations across the U.S., Mexico and Costa Rica, entered into a long-term sale-leaseback arrangement for the four properties following the acquisition.

Situated in the New Orleans, Houston, Saint Louis and Jacksonville MSAs, the assets are mission-critical to ConGlobal due to their strategic location within dense IOS clusters, in proximity to key port and rail infrastructure. Their favorable zoning also allows the sites to function as container storage depots and provide the increasingly rare ability to stack shipping containers.

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The companies did not release the price paid for the properties. They are located at: 10090 Almonaster Ave., New Orleans, La., comprising 13.33 usable acres (UAC) and a 16,000-square-foot building; 500 Mayo Shell Road, Galena Park, Texas, including 19.79 UAC and a 26,000-square-foot building; 1740 Sauget Industrial Parkway, Sauget, Ill., comprising 33 UAC with a 7,500-square-foot building; and 10444 Alta Drive, Jacksonville, Fla., with 23 UAC.

With more than 50 years of industrial experience, ConGlobal has offices in Fort Worth, Texas; Darien, Ill.; Corvalis, Ore.; and Odessa, Fla. In December, the company opened a new U.S. Customs bonded facility with more than 30 acres within NorthPoint Development’s master-planned industrial park surrounding Logistics Park Kansas City, BNSF’s state-of-the-art intermodal facility in Edgerton, Kan. The facility provides services including yard management solutions, site operation and storage for loaded and empty containers.

Alterra IOS’ growth vision

Alterra IOS, the IOS arm of Alterra Property Group, a Philadelphia-based real estate investment and development company, entered the industrial subsector in 2016. The firm has acquired or developed more than 180 properties across more than 30 states. In May, company officials told Commercial Property Executive Alterra IOS was nearing a portfolio with $2.5 billion in assets, with about $850 million in acquisitions made between 2022 and mid-2023.

Matthew Pfeiffer, managing partner & CIO at Alterra Property Group, told CPE at the time that institutional investors recognize the core aspect of the IOS business—an imbalance on supply and demand.

“What sets IOS apart from some other asset classes in real estate is that supply is structurally muted with municipalities not being incentivized to add new zoned land for outdoor storage. The structural limit on supply coupled with the fact that the majority of tenants need to locate in infill locations of major MSAs near respective demand generators, leads to pricing power with landlords,” Pfeiffer said.

The ConGlobal transaction was spearheaded by Parker Pearson, an acquisition vice president for Alterra Property Group. While the companies did not provide details of previous deals, both stated the four-property portfolio acquisition was a continuation of a mutual collaboration.

Charlie Totten, senior vice president of acquisitions at Alterra Property Group, said in a prepared statement they are seeing increased sale-leaseback activity across the industrial and outdoor storage asset classes. He said corporate motivations vary, but Alterra can react quickly and provide a seamless path to liquidity with its discretionary capital. Totten, who noted the firm will continue to invest in the IOS asset class on a national scale, said he expects there will be a strong sale-leaseback pipeline in 2024.

In December 2022, Alterra IOS Manager, on behalf of its discretionary private real estate client, acquired a 14-property portfolio of IOS assets across eight states for more than $86 million in a sale-leaseback deal with Heniff Transportation Systems. The portfolio is fully leased by Heniff, a national bulk transportation provider with nearly 100 locations across the U.S.