Indus Enters Phoenix With $72M Buy
Amazon is one of the building's tenants.
Indus Realty Trust has acquired Phoenix Airport Logistics, a 393,484-square-feet warehouse/distribution center in Phoenix’s airport submarket. CBRE Investment Management sold the asset for $72.4 million, according to public records. The building was fully leased to five tenants at the time of the sale, including Amazon. Cushman & Wakefield advised the seller.
Ahead of the recent sale, the property carried a $27.2 million loan originated in 2020 by Pacific Coast Capital Partners. The property last traded in 2019, when Principal Real Estate Investors sold it for $38.8 million.
The cross-dock distribution center located at 3333 S. Seventh St. came online in 2016 It includes a 36-foot clear height, 96 dock-high doors and 62 trailer parking spaces. It is located near both downtown Phoenix and Sky Harbor Airport.
Indus Realty Trust, which specializes in logistics properties, owns or has majority ownership in 55 properties and projects under development, totaling 9.3 million square feet. Indus itself is largely owned by affiliates of Centerbridge Partners, a private investment firm, and GIC, a global institutional investor. Also, a subsidiary of the Abu Dhabi Investment Authority owns an interest in Indus.
Earlier this year, Indus acquired a recently completed 550,243-square-foot industrial facility in Jacksonville, Fla., that is fully leased to European retailer Primark. VanTrust Real Estate was the seller.
As for the Phoenix deal, Cushman & Wakefield Executive Vice Chair Will Strong, Director Michael Matchett and Senior Associate Molly Hunt brokered the deal as exclusive brokers.
Supply wall hits Phoenix industrial
The Phoenix industrial vacancy came in at 12.7 percent in the third quarter of 2024, the sixth consecutive quarterly rise, according to Cushman & Wakefield. The reason is straightforward: a rush of supply into the market immediately after 2020 that hasn’t been matched by demand, even though demand is still higher than it was in 2019.
Net absorption marketwide in the third quarter came in at 6.1 million square feet, a quarter-over-quarter drop from 8.1 million square feet. A lot of recent absorption has been build-to-suit completions, such as for TSMC’s 4.3 million-square-foot facility, the C&W report noted. The pace of construction, however, is now tapering off.
The Phoenix Airport submarket had a vacancy rate of only 6.5 percent in the third quarter, much lower than the metro figure, the same source shows. But even the Airport submarket is seeing a supply/demand imbalance: Year-to-date net absorption in the area is about 228,200 square feet, while construction completions in the third quarter alone totaled more than 1 million square feet.
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