Acquires Assets from Alterra IOS and J.P.
Morgan Asset Management
Establishes Presence in High-Growth Industrial
Outdoor Storage Sector
Provides Significant Mark-to-Market Opportunity
Over Time
Complements Existing Industrial Portfolio
Schedules Transaction Webcast for Tuesday,
November 5, 2024, at 8:30 AM EST
Peakstone Realty Trust (the "Company") (NYSE: PKST), a real
estate investment trust focused on owning and operating industrial
assets, announced today that the Company has acquired a portfolio
of 51 industrial outdoor storage (“IOS”) properties from a joint
venture between Alterra IOS, and institutional investors advised by
J.P. Morgan Asset Management in an off-market transaction valued at
$490 million. The acquisition was funded by a combination of
proceeds from the Company’s credit facility and cash on hand.
The 51-property infill portfolio comprises 45 operating assets
and six redevelopment sites. These assets span a total of 440
usable acres across 14 states and are strategically located near
major supply chains and population centers. The operating portfolio
has a WALT of 4.5 years1 and is approximately 100% leased2 to
diversified, high-quality, primarily national and regional
tenants.
Through this acquisition, Peakstone has expanded its overall
industrial footprint and has established a significant presence in
this emerging, high-growth sector. Industrial outdoor storage is
characterized by favorable operating dynamics, significant supply
constraints and minimal capital expenditure requirements. The
Company has significantly enhanced its long-term growth profile
with a potential 70% mark-to-market opportunity3 on the IOS
operating assets and the ability to achieve incremental yield
through six redevelopment sites.
"We are pleased to announce our entry into the industrial
outdoor storage sector,” said Michael Escalante, CEO of Peakstone.
“This portfolio is highly complementary to our existing industrial
business, and adds meaningful scale, breadth and growth
opportunities in a sector with compelling operating fundamentals.
We expect that favorable market trends will persist in the IOS
sector, and will drive long-term value for shareholders. Looking
forward, we are committed to shifting our portfolio more towards
industrial, and we will be strategic about balancing industrial
investments while reducing leverage.”
“Peakstone’s acquisition of this high-quality portfolio advances
the institutionalization of the IOS asset class,” said Leo
Addimando, CEO and Managing Partner of Alterra and Matt Pfeiffer,
CIO and Managing Partner of Alterra. “We believe this transaction
is a win-win, and that Peakstone is the right owner to build upon
the success of these assets and drive further value.”
“This portfolio transaction represents an important milestone in
the execution of one of our highest conviction strategies,” said
Preston Meyer, Managing Director and Portfolio Manager at J.P.
Morgan Asset Management.
Advisors
BofA Securities served as Peakstone’s exclusive financial
advisor. O'Melveny & Myers LLP, Latham & Watkins LLP, and
DLA Piper served as Peakstone’s legal counsel.
Webcast & Conference Call Information
Peakstone will host a webcast to discuss the transaction. Please
see below for event details:
- Tuesday, November 5, 2024, at 8:30 a.m. U.S. Eastern time
- Live webcast at https://investors.pkst.com by clicking Events
& Presentations
- Participant Toll-Free Dial-In Number: 1-844-826-3035 or
1-412-317-5195; Conference ID: 10194222
- The webcast replay will be posted when available in the
Investor Relations "Events & Presentations" section at
www.pkst.com
About Peakstone Realty Trust
Peakstone Realty Trust is an internally managed REIT focused on
owning and operating industrial assets. Peakstone’s high-quality
portfolio consists of predominately single-tenant properties
located in strategic markets. Additional information is available
at www.pkst.com.
About Alterra IOS
Alterra’s industrial real estate platform, Alterra IOS, is
dedicated to providing real estate solutions through property
acquisition, development, management & leasing for tenants in
the heavy industrial & outdoor storage space. Focused on
low-building coverage sites with large, stabilized yard space to
accommodate an array of uses such as vehicle, material, and
equipment storage, Alterra brings an institutional comprehension of
the municipal & logistical complexities in securing
mission-critical real estate for the often-overlooked sectors of
the U.S. industrial landscape. Over the past six years, Alterra IOS
has created tenant relationships in the transportation &
logistics, vehicle storage, equipment rental, and building
materials industries through the acquisition or development of over
280 properties across 30+ states as of Q3 2024. The dedicated team
of investment, development, construction, and asset management
professionals provide tenants the resources to grow and improve
their businesses through site selection, development, and/or
sale-leaseback transactions.
About J.P. Morgan Asset Management
J.P. Morgan Asset Management is a global leader in alternatives,
with over 60 years of experience managing alternative investments,
including real estate, private equity, private credit, liquid
alternative products, infrastructure, transport, hedge funds, and
forestry. As of September 30, 2024, J.P. Morgan oversees more than
$400 billion in alternative assets.
With $3.5 trillion in assets under management as of September
30, 2024, J.P. Morgan Asset Management serves institutions, retail
investors, and high-net-worth individuals across every major market
globally. The firm offers comprehensive investment management
services in equities, fixed income, alternatives, and liquidity.
For more information, visit www.jpmorganassetmanagement.com. J.P.
Morgan Asset Management is the marketing name for the asset
management businesses of JPMorgan Chase & Co. and its
affiliates worldwide.
Cautionary Statement Regarding Forward-Looking
Statements
This document contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
Section 27A of the Securities Act of 1933, as amended (the
“Securities Act”), and Section 21E of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”). We intend for all such
forward-looking statements to be covered by the applicable safe
harbor provisions for forward-looking statements contained in
Section 27A of the Securities Act and Section 21E of the Exchange
Act. Forward-looking statements relate to expectations, beliefs,
projections, future plans and strategies, anticipated events or
trends and similar expressions concerning matters that are not
historical facts. In some cases, you can identify forward-looking
statements by the use of forward-looking terminology such as “may,”
“will,” “should,” “expects,” “intends,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” “targets,” or “potential” or
the negative of these words and phrases or similar words or phrases
which are predictions of or indicate future events or trends and
which do not relate solely to historical matters. You can also
identify forward-looking statements by discussions of strategy,
plans or intentions.
The forward-looking statements contained in this document
reflect our current views about future events and are subject to
numerous known and unknown risks, uncertainties, assumptions and
changes in circumstances that may cause our actual results to
differ significantly from those expressed in any forward-looking
statement. The following factors, among others, could cause actual
results and future events to differ materially from those set forth
or contemplated in the forward-looking statements: general economic
and financial conditions; market volatility; inflation; any
potential recession or threat of recession; interest rates;
disruption in the debt and banking markets; tenant, geographic
concentration, and the financial condition of our tenants;
competition for tenants and competition with sellers of similar
properties if we elect to dispose of our properties; our access to,
and the availability of capital; whether we will be able to
refinance or repay debt; whether work-from-home trends or other
factors will impact the attractiveness of industrial and/or office
assets; whether we will be successful in renewing leases as they
expire; whether we will re-lease available space above or at
current market rental rates; future financial and operating
results; our ability to manage cash flows; dilution resulting from
equity issuances; expected sources of financing, including the
ability to maintain the commitments under our revolving credit
facility, and the availability and attractiveness of the terms of
any such financing; legislative and regulatory changes that could
adversely affect our business; cybersecurity incidents or
disruptions to our or our third party information technology
systems; our ability to maintain our status as a REIT and our
Operating Partnership as a partnership for U.S. federal income tax
purposes; our future capital expenditures, operating expenses, net
income, operating income, cash flow and developments and trends of
the real estate industry; whether we will be successful in the
pursuit of our business plans, objectives, expectations and
intentions, including any acquisitions, investments, or
dispositions, including our acquisition of industrial outdoor
storage assets; our ability to meet budgeted or stabilized returns
on our redevelopment projects within expected time frames, or at
all; whether we will succeed in our investment objectives; any
fluctuation and/or volatility of the trading price of our common
shares; risks associated with our dependence on key personnel whose
continued service is not guaranteed; and other factors, including
those risks disclosed in “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” in our Quarterly Report on Form 10-Q, in our most
recent Annual Report on Form 10-K and any subsequent Quarterly
Reports on Form 10-Q.
While forward-looking statements reflect our good faith beliefs,
assumptions and expectations, they are not guarantees of future
performance. The forward-looking statements speak only as of the
date of this document. We disclaim any obligation to publicly
update or revise any forward-looking statement to reflect changes
in underlying assumptions or factors, new information, data or
methods, future events or other changes after the date of this
document, except as required by applicable law. We caution
investors not to place undue reliance on any forward-looking
statements, which are based only on information currently available
to us.
Notes
- Weighted average based on ABR, defined as in-place monthly
contractual base rent excluding rent abatements under leases as of
November 4, 2024, multiplied by 12 months. For leases that have a
rent abatement period in effect as of November 4, 2024, the Company
used the monthly contractual base rent payable following expiration
of the abatement period.
- Weighted average based on usable acres.
- Based on management’s estimate of market rental rates as of
November 4, 2024 divided by in-place monthly contractual base rent
for the operating assets as of that date. No assurance can be given
that expiring leases will be renewed or that available space will
be re-leased above, below or at management's estimate of market
rental rates.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241104431920/en/
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