Wednesday, January 28, 2015

Cabot Properties Pulls in $150 Mil. for a New Industrial Real Estate Fund

The Pennsylvania Public School Employees’ Retirement Board has committed to invest up to $150 million into a new core industrial fund being put together by Boston-based Cabot Properties.

Cabot Industrial Core Fund will focus exclusively on the industrial sector, targeting a limited number of select markets with growing demand and asset scarcity. With the PSERS investment, it is expected a portion of the fund’s investment will be in that state.

Cabot will generally pursue transactions smaller than $50 million and will seek to assemble portfolios for future sales at premium prices. Cabot anticipates investing $750 million in equity and will endeavor to create a portfolio of industrial properties with a fully capitalized value of $1.1 billion (assuming 40% leverage).

The portfolio is generally expected to consist of 80 to 120 buildings totaling 17 million to 20 million square feet.

Cabot anticipates that single tenant buildings will be 30% to 50% of the portfolio. Cabot projects building sizes will typically be 100,000 square feet to 700,000 square feet and that the tenant size may average 200,000 square feet.

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