Dec 02 2012
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Gatehouse Bank acquires US industrial real estate portfolio
The $178 million portfolio was acquired in partnership with the Brennan Investment Group (BIG). The properties, located in 16 cities across the Midwest, Northeast, Southeast and Southwest regions of the U.S., will be held for approximately five years, offering investors a stable projected net annual cash yield as well as an attractive IRR upon exit from the investment.
“This is an attractive investment opportunity with the potential to deliver an extremely robust and long term income stream of high net yields that appeal to our investors. This is the second industrial portfolio to be acquired by Gatehouse Bank in the US, bringing our total acquisitions in the sector to almost $350 million. The investment case for property in this sector remains strong, with credit to the diversity of tenants, industries and geographies associated with a portfolio purchase of this type,” Fahed Boodai, Chairman of the Board of Directors at Gatehouse Bank, said.
“Historically, annual average returns are comparable to the Office and Multi-Family sectors, but with much less volatility, which makes it an increasingly appealing investment prospect.”
“It is an attractive time to have acquired an industrial real estate portfolio of this calibre. Industrial space absorption in 2012 should exceed 2011 levels by 25%, with national occupancy rates back up to 92%. A stronger business environment drove the demand for industrial space in almost all industries, with all four census regions of the US-South, mid-West, West and East-reporting positive space absorption,” Michael Brennan, Chairman and Managing Principal of the Brennan Investment Group, added.
The portfolio includes a number of inherent features of US industrial real estate that make the sector appealing for investment. It offers stability and predictability of cash flow, low operational risk, low on-going capital requirements, diversity of investment and a low risk of oversupply.
Gatehouse Bank specialises in originating, structuring and funding investments in a Shariah compliant manner. To meet continuing investor demand for high quality property investments, Gatehouse provides leading advice and opportunities to investors across a diverse range of properties ranging from offices to the student and logistics sectors. This is the fifth US-based real estate investment offering presented to the market by Gatehouse Bank, and brings its global real estate portfolio to in excess of $1.5 billion.
Gatehouse Bank was assisted by Arch Street Capital Advisors and sister company GSH in this transaction.
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