Realty Income Corp. Pays $128M for Richmond Facility

Lowe’s Richmond. Image courtesy of JLL Capital Markets

Realty Income Corp. has acquired Lowe’s Richmond, a 1.2 million-square-foot logistics facility in Richmond, Va. According to Richmond County records, the company paid $127.7 million for the asset.

A partnership comprising developer Hourigan Group, alongside CRG, DSC Partners and Iron Point Partners, sold the recently completed property.

According to the Richmond BizSense, this is the second-largest real estate transaction in the city’s metro area this year.

The property is the largest infill bulk facility in Richmond and is fully leased to Lowe’s Home Centers for its Southeast distribution. The company preleased the building since its construction phase for a 10-year term, the same county records show.

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The property is located at 2703 Commerce Road, 10 miles from downtown Richmond and is situated next to Interstate 95. Richmond Marine Terminal is only 2.2 miles away, with Richmond International Airport 12.3 miles northeast of the industrial park. Other companies in the surrounding area include Amazon, Phillip Morris, Brother International, Motley Logistics Systems and Dupont.

The JLL Capital Markets team representing the seller included Managing Director Patrick Nally, Senior Managing Directors Britton Burdette and Bill Prutting, Director Craig Childs and Associate Josh McArdle.

Deepwater Industrial Park development

Lowe’s Richmond is part of Deepwater Industrial Park. DSC Partners and Hourigan broke ground on the first phase of the project in May 2021. CommercialEdge data shows the property was subject to a $66.8 million loan in 2021, originated by Citizens Financial Group. According to the same data provider, the land for the development was purchased in 2017 for $8.5 million.

Two other buildings are in the development phase in the same industrial park, which will add 321,724 square feet, bringing the total to roughly 1.5 million square feet of industrial space.

In September, Realty Income, in a joint venture with Ocean West Capital Partners and Tiger Alternative Investors sold a seven-property portfolio for $905 million. The facilities were located throughout the Sun Belt and Northeast, comprising more than 7 million square feet.

Richmond’s industrial activity

CommercialEdge data shows that 70 industrial properties sold in the Richmond market since the beginning of the year, a total of approximately 6.7 million square feet of space. Eleven of these assets were Class A facilities, concentrated mostly around Richmond International Airport.

Richmond’s construction pipeline of industrial properties is also strong,  with 47 projects in various stages of development, according to the same data provider.