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Investcorp, Capital Partners buy $51M industrial portfolio


A joint venture between Minneapolis-based Capital Partners and New York-based Investcorp International has paid nearly $51 million for a portfolio of industrial properties in the Twin Cities.


An entity related to the two investors bought 11 buildings through multiple transactions, according to certificates of real estate value for nine properties, and a news release from the Minneapolis office of CBRE. The 833,193-square-foot portfolio consists of flex warehouse and office warehouse buildings in Minneapolis, Brooklyn Center, Edina, Eden Prairie, Plymouth, St. Paul and Champlin.


The seller, Los Angeles-based Tryperion Partners, had owned the portfolio for about four years, having built it one transaction at a time, said Judd Welliver, a CBRE senior vice president who represented Tryperion. The sale was prompted by industrial real estate market conditions he described as “active and robust.” The overall industrial vacancy rate in the Twin Cities is 4.3 percent, according to CBRE.


“It was just the timing of the market,” Welliver said of the sale.


The new owners confirmed that the total portfolio purchase price was $50.8 million. The deal, which closed Wednesday, works out to an average of $60.97 per square foot. The price met the seller’s expectations, Welliver said.


Capital Partners and Investcorp bought the warehouse properties because they have “high cash flow,” said Peter Mork, a Capital Partners managing partner. The entire portfolio has an occupancy rate of 86.6 percent.


“They’re just good bread-and-butter functional real estate spread through the core of the Twin Cities,” Mork said Friday.


Hennepin and Ramsey counties value the 11 properties at a combined $39.33 million for tax purposes.


These properties were made public in the CRVs:

  • 6820 Shingle Creek Parkway, Brooklyn Center, $7.89 million, 146,870 square feet.

  • 6840 Shingle Creek Parkway, Brooklyn Center, $7.66 million, 113,510 square feet.

  • 5205 Highway 169, Plymouth, $5.84 million, 98,847 square feet.

  • 11100 Jefferson Highway N., Champlin, $5.65 million, 133,949 square feet.

  • 7500 Washington Ave. S., Eden Prairie, $5.23 million, 46,200 square feet.

  • 500 Kasota Ave. SE, Minneapolis, $5.11 million, 74,874 square feet.

  • 7301 and 7251 Washington Ave. S., Edina, $4.48 million, 25,952 and 26,265 square feet.

  • 7180 Northland Circle N., Brooklyn Park, $3.82 million, 57,600 square feet.

The two other properties in the deal are a 31,924-square-foot warehouse at 7550 Washington Ave. S. in Eden Prairie, and a 75,682-square-foot warehouse at 2350 Kasota Ave. in St. Paul, according to CBRE.


Most of the buildings in the portfolio were constructed in the 1970s and 1980s, Welliver said.


Investcorp and Capital Partners plan to own the warehouses for five years or longer, Mork said.


Investcorp’s real estate investments target existing office, retail, industrial, multifamily and hospitality properties in the 30 largest metropolitan areas in the United States, according to the company’s website.


In addition to the industrial properties it just purchased, Investcorp owns the Oracle Centre and International Centre building at 900 Second Ave. S. in downtown Minneapolis, the 320-unit Southwind Village townhome-style rental complex in Burnsville, and the 534-unit Hampshire Hill apartments in Bloomington.


Capital Partners has been building its portfolio for the past 15 years, Mork said, and owns 3.8 million square feet of industrial space.


Tryperion owns all classes of commercial real estate, according to its website. Welliver declined to say whether Tryperion owns any other Twin Cities properties.

Ryan Watts, Sonja Dusil and Tom Holtz were also on the CBRE team that represented Tryperion.


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source: Finance & Commerce