Ivy Realty Obtains $41M for NJ Portfolio Purchase

Somerset Portfolio

Cushman & Wakefield recently orchestrated financing for Ivy Realty’s acquisition of a 768,200-square-foot industrial portfolio in Somerset County, N.J. BBVA Compass provided Ivy with $41 million, a portion of which Ivy will apply toward renovation and leasing expenses related to its planned rebranding of the collection of properties.

“We received strong lender feedback, but eventually chose BBVA as they demonstrated a clear understanding of the opportunity and business plan. They provided attractive terms that were flexible to match with the sponsor’s future needs,” John Alascio, an executive managing director with Cushman & Wakefield, said in a prepared statement. Alascio’s colleagues Sridhar Vankayala, senior director, and Zachary Kraft, senior analyst, completed the team that represented Ivy.

Ivy’s newly acquired seven-property portfolio includes the industrial facilities at 1 Riverview Drive, 50 Randolph Road, 100 Randolph Road and a 5-acre land parcel in Somerset. The remainder of the collection, located in Warren, consists of the flex/lab buildings at 7 Powder Horn Drive and 45 Technology Drive, as well as the office buildings at 30 Technology Drive and 40 Technology Drive. Aside from 45 Technology, which opened in 2001, all six buildings were developed between 1985 and 1988.

Atlantic Development and Management Corp. previously owned the group of assets, per Somerset County records.

What lenders like

According to a capital markets update released by Cushman & Wakefield in February 2019, capital markets favor industrial. And as Vankayala noted in a prepared statement on the Ivy transaction, lenders’ appetite for the asset type is made stronger when solid sponsorship and a distinct value-add business plan are part of the package.

“At a macro level, the overall industrial trend and outlook is strong, driven in large part by changing consumer patterns—e-commerce, same-day delivery, etcetera,” Vankayala told Commercial Property Executive. “From a portfolio allocation perspective, lenders are still underweight on industrial compared to other asset classes, which has increased their demand for this asset class.”

Image courtesy of Cushman & Wakefield