By Paul Schwedelson – Reporter, Philadelphia Business Journal
A Northeast Philadelphia wholesale food distributor sold its cold storage warehouse for $41 million and executed a leaseback for the entire 241,000-square-foot building, allowing the company to remain in place while receiving an infusion of cash.
Phoenix-based Fundamental Income bought the 40-year-old building at 2701 Red Lion Road from Quaker Valley Foods. The Philadelphia-based company purchased the building in 2004 for $9.8 million, according to property records. The property is just north of the Northeast Philadelphia Airport near the intersection of Red Lion Road and Roosevelt Boulevard.
The recent sale of the building comes out to about $170 per square foot.
Quaker Valley Foods signed a long-term lease for the building, Fundamental Income Chief Investment Officer Alexi Panagiotakopoulos said. Operations have continued as usual unaffected by the transaction.
“We’re very business-oriented investors. We generally go where our tenants want to go because they believe they’re in important locations for their business and their operations,” Panagiotakopoulos said. “That was part of it, supporting the tenant and their aspiration to serve the greater MSA as well as the region and density around the Philadelphia area.”
Quaker Valley Foods was founded in 1975 in Northeast Philadelphia. The firm distributes meat, seafood and deli items from Connecticut to Virginia and warehouses over 3,000 fresh and frozen perishable and non-perishable items.
Quaker Valley Foods declined to comment.
Fundamental Income is backed by Brookfield Asset Management (NYSE: BAM) and specializes in buying single-tenant properties and executing leasebacks. It was founded in 2018 and owns more than 450 properties spanning 11.5 million square feet across 44 states and 55 different industries.
The company’s strategy is to hold assets and collect rent from the existing tenants the firm believes in rather than looking to develop properties or quickly flip them, Panagiotakopoulos said.
“We may hold [2701 Red Lion Road] for 10-, 15-, 25-plus years,” Panagiotakopoulos said. “That’s our entire investment thesis is long-term holds.”
Full story: http://tiny.cc/o8ha001
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