CoStar had a report on KKR selling 5 million sf of industrial. Any idea on the metrics of this transaction (going-in cap, stabilized yield, etc.)?
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Do you have access to the actual article?
I do. It references markets the properties are located, but no key metrics.
Here's some quick and dirty info I pulled up on this deal (all from CoStar/ educated guesses so take with a grain of salt). Using one project 7523 Southlake Pky in Morrow GA as an example.
Context:
Again, quick and dirty, but that's basically how I see it. Hard to not have made money with the insane rent growth we've seen since COVID.
How in the world is the buyer “winning” if they are buying real estate at a yield that is barely above a risk free 10 year treasury?
My comment was a little tongue in cheek to be fair, but that ~5 cap for Exeter is based on the current lease rate. With the near-term WALT, there counting on a significant mark to market after the current lease expiration. Ignoring TI's, LC, lease up period, etc. to keep it simple: If the sign a near lease in the space at $8.25 (probably about where it would trade in 2-years, assuming avg. rent growth) that's about an 8.8% YoC. Again, vastly oversimplifying here, but that the basic logic behind a play like this. I personally think we'll see some rent stabilization and lease up periods extend, which could put pressure on the thesis but there does seem to be a decent margin of safety here with how below market rents are.
Fair enough
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