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Law360 (December 3, 2020, 5:29 PM EST ) Real estate investment firm Stockbridge and National Pension Service of Korea said Thursday they've teamed up to buy a 14.3 million-square-foot logistics portfolio located across more than half a dozen states in what Stockbridge, which had counsel from Gibson Dunn and Clifford Chance, said is the largest logistics deal by value amid the COVID-19 pandemic.
The deal is the latest indication of investor appetite for logistics properties, which have seen an uptick in demand amid the pandemic as more online shopping fuels more need for distribution centers close to metro areas in order for retailers to make good on two-day and same-day shipping promises.
The buyers did not disclose sell-side info or financial terms of the purchase, but said PGIM Real Estate Finance and Nuveen Real Estate provided financing for the transaction.
"We see this acquisition as an exceptional way of tapping into the rapid acceleration of e-commerce growth — one of the most impactful investment themes post-COVID[-19], and likely of the decade to come," Terry Fancher, Stockbridge executive managing director, said in a statement Thursday.
"The tremendous ongoing support of our venture partners has afforded us the opportunity to transact quickly and nimbly in order to access these kinds of rare opportunities at scale," Fancher added.
The portfolio includes properties in the Atlanta, Boston, Chicago, Cincinnati, Dallas, Detroit, Jacksonville, Los Angeles, Memphis, Miami and Pittsburgh metro areas.
The portfolio also includes three properties in Shoemakersville, Pennsylvania, which is roughly equidistant from Philadelphia and Harrisburg.
"This was a fast-moving and also a highly complex transaction," Erin Rothfuss, a partner and co-chair of the real estate practice at Gibson Dunn & Crutcher LLP, told Law360 on Thursday. "In the post-COVID[-19] era, [industrial real estate's] outperformance has been far more pronounced as e-commerce growth has accelerated many times over and I believe that the sector has far more room to run."
The largest property among the mix is a roughly 2 million-square-foot facility in Riverside, California. The portfolio also includes two properties north of 1 million square feet in the Boston metro area, second properties with roughly 1 million square feet in Pennsylvania and California and single properties in the Atlanta and Memphis areas with more than 1 million square feet.
The Boston and Chicago metro-area properties are across state lines, in New Hampshire and Wisconsin, respectively.
NPS managed $672 billion in assets as of the end of September.
"We are excited to acquire high-quality industrial properties that are well aligned with our strategy to capitalize on the paradigm shift to e-commerce," Scott Kim, head of the real estate investment division at NPS, said in a statement Thursday. "Our local presence in New York has allowed us to quickly underwrite the portfolio and manage partner relationships to successfully form this venture."
Stockbridge is represented by Erin Rothfuss, Brian Kniesly, David Regan, Kylie Thompson, Anna Peterson, Marko Stankovic and Evan Gusler of Gibson Dunn & Crutcher LLP, while Jeanne Roig-Irwin of Clifford Chance US LLP helped Stockbridge with certain structuring and joint venture matters.
Additional counsel information was not immediately available Thursday.
--Editing by Alyssa Miller.
For a reprint of this article, please contact reprints@law360.com.
