Burton-Katzman, a commercial real estate company in Bingham Farms, has acquired 24 strategically located industrial properties across the Midwest with $150 million in financing from New York commercial real estate firm Newmark.
The portfolio spans 2.2 million square feet, is 99 percent leased with a five-year weighted average lease term (WALT), and features a diversified national tenant roster. It includes the property at 30860 Sierra Drive in Chesterfield Township.
The combination of single- and multi-tenant commercial properties has a proven track record of long-term stability, according to Burton-Katzman. It has retained occupancy levels above 99 percent for the past decade, with current in-place tenants averaging more than 10 years in their space. With more than 40 tenants on the rent roll, no user occupies more than 15 percent of the portfolio’s square footage, effectively mitigating rollover risk.
“Investment in industrial real estate by institutional owners remains a top-choice asset class for investors, especially those in secondary and tertiary markets that still offer growth potential,” says Dustin Stolly, co-head of debt and structured finance at Newmark.
The Detroit industrial market, according to Stolly, continues to experience strong market fundamentals — vacancy rates continue to sit near all-time lows, generating double-digit rent growth year-over-year post-pandemic. The portfolio features assets across dense industrial hubs with the highest barriers to entry, including Auburn Hills, Sterling Heights, Dearborn, and Livonia.
The Burton-Katzman team has operated the portfolio historically and developed relationships with the existing tenancy, allowing it to create strategic leasing transactions.
DRA Advisors in New York also was part of the transaction and has participated in more than 84 million square feet of industrial acquisitions.
“The portfolio represents a highly compelling opportunity to acquire a dynamic, well-occupied, and cash-flowing light industrial portfolio at an attractive basis with a best-in-class joint venture partner,” says Brett Gottlieb, managing director of DRA Advisors.