Continued leasing activity and substantially increasing rents over two years of the COVID-19 pandemic demonstrated the demand and potential of two warehouses to real estate investment trust One Liberty Properties, which closed on a deal to buy the two buildings for $17.2 million.
The sale, which involved 6305 and 6507 Fairfield Drive in Northwood, a suburb of Toledo, also included a trailer parking lot on 18.2 acres. The total square footage of the warehouses is approximately 252,000. The price includes $6 million of mortgage debt with an interest rate of 3.57%, according to a news release issued by One Liberty Properties at the time of sale.
Robert Mack, vice president and principal of Signature Associates, brokered the deal. He also brokered the sale of the land to Miller Valentine Group of Dayton — now Kuhlmen Realty Services — and has been a listing agent for the property for the past 24 years.
A long-term dedication to bringing and maintaining key industrial space in the Toledo market earned the warehouse lease a 2023 CoStar Impact Award, as judged by real estate professionals familiar with the market.
"In 1998, I had some discussions with the Miller Valentine Group ... regarding a void of any Class-A industrial space in the Toledo area market. The discussions were timely as there was considerable market speculation regarding the impact of a planned Jeep Toledo North Assembly plant being built, which would require a hub of Tier 1 suppliers with shortened broadcast windows for production and many components having a high level of just-in-time criticality," he wrote.
"Miller Valentine had other facilities catering to the new trends in automotive Tier 1 suppliers and purchased a 16-acre site fronting on I-75 and proposed a two-building site plan revealing 251,500 square feet of tilled-up concrete construction that the Toledo market was not accustomed to, especially on a speculative basis."
About five years ago, he added, an unsolicited offer of $12 million on the property was ultimately rejected by the owners, who decided "to hold on to the investment and continuously monitor market conditions in hopes of modest upside."
"Fast-forward through COVID, and with continued leasing activity and increasing rents within the building and especially within the marketplace, the partners were revisiting the prospect of a sale," he wrote.
"Purchaser candidates submitted offers from both the east and west coast and also locally. ... The buyer [One Liberty Properties] recognized substantially increasing rents and the immediate submarket as a result of the successful leasing of new spec buildings, revealing substantial demand that would outpace the existing supply and future supply of buildings under construction. The buildings remain 100% leased."
Based in Great Neck, New York, One Liberty Properties has a portfolio of 121 properties in 31 states, totaling more than 11.3 million square feet of space. The properties range from industrial to retail, restaurant, fitness, grocery and office.
About the Project: One Liberty Properties, Inc., bought the 251,500-square-foot, two-building warehouse 6305 and 6507 Fairfield Drive in Northwood, Ohio, in a deal that closed on Nov. 15, 2022.
What the Judges Said: "Broker stuck with the property/client for 20-plus years, did leasing prior, and consummated a large sale in town. He added value to the client through leasing in preparation for marketing the asset." — Evan Lyons, senior director, Encore Real Estate Investment Services.
They Made It Happen: Robert Mack, vice president and principal of Signature Associates.