Prologis, Norges Bank Buy KTR Industrial Portfolio for $5.9B

Norges Bank Investment Management announced this week that, in a joint venture with Prologis, it had signed an agreement to acquire a 45% interest in a 60 million square feet industrial portfolio with additional development potential. Prologis will acquire the remaining 55% interest in the portfolio and will perform the asset management on behalf of the partnership. The deal is part of an existing joint venture between Prologis and Norges Bank Investment Management, manager of the NOK6.94trn (€824bn) Government Pension Fund Global, to invest in US logistics property, according to an IPE report. Prologis, with a market value of about $22 billion, said the acquisition will expand its position in Southern California, New Jersey, Chicago, South Florida, Seattle and Dallas.

"It is rare to have the opportunity to acquire a portfolio of such high asset quality, customer profile and market composition that is so consistent with our own," said Hamid Moghadam, chairman and CEO, Prologis. "I have known KTR's leadership for 15 years and have always considered them to be astute investors and one of our toughest competitors in the U.S. This transaction will deliver accretive returns to our shareholders and will enhance our important and successful partnership with NBIM, which will now exceed $11 billion on two continents."

The 60 million square foot operating portfolio consists of 322 operating properties located across 17 US states. The acquisition includes an additional 10 properties with 3.6 million square feet currently under construction and land with a build-out potential of 6.8 million square feet. The purchase price includes the assumption of $700 million in debt. As part of the transaction, Prologis said it will issue up to $230 million of its common limited partnership units to KTR. Prologis said it has obtained a commitment from Morgan Stanley Senior Funding, Inc. to provide a $1.0 billion bridge facility for the transaction.

For more news and information visit Blumberg Partners.

DC's Thurman Arnold Building Sold for $505M

Manulife Financial Corp. moved forward with the sale of the Thurman Arnold building at 555 12th St. NW in Washington, DC as MetLife and a Norwegian pension fund manager have teamed up to pay roughly $505 million for the property. Manulife originally announced last May that it was seeking buyers for the building, having lost the law firm Arnold & Porter LLP as its anchor tenant. Manulife retained Eastdil Secured to market the 12-story building, which was assessed at $203.8 million, according to a Washington Business Journal article. The sale on the property — now assessed at $579.8 million, according DC's Office of Tax and Revenue — closed Wednesday morning as MetLife and Norges Bank Investment Management secured the property.

The 18-year-old Thurman Arnold Building encompasses a full city block in the East End, at the corner of F and 12th streets. The property is roughly 94% leased, but Arnold & Porter will be moving out of the 447,772 square feet it occupies when its lease ends in 2015. The building is named after the iconoclastic DC lawyer Thurman Arnold who cofounded Arnold & Porter along with Paul A. Porter and Abe Fortas.

For more news and information visit Blumberg Capital Partners.

Prologis, Norges Form $1B Joint Venture

In its second venture with Norges Bank, Prologis, Inc. announced this week that it had signed a definitive agreement to form Prologis U.S. Logistics Venture with Norges Bank Investment Management, which is the manager of the Norwegian Government Pension Fund Global. Under the agreement, Norway's government pension fund purchased a 45% stake in a 12.8 million-square-foot industrial and logistics property portfolio in the U.S. from Prologis Inc. for $450 million. The portfolio includes 66 properties throughout eight states across nine markets, with the deal price valuing the portfolio at approximately $1 billion, according to a World Property Channel report.

"Following our joint venture in Europe earlier this year, we are pleased to extend our relationship with NBIM into the U.S.," said James Green, managing director, Global Client Relations, Prologis.

"The formation of this venture is consistent with our joint long-term focus of investing in high-quality assets in key global markets," said Eugene Reilly, chief executive officer, Prologis Americas. "U.S. Logistics Venture is expected to grow in the future, including through acquiring strategic portfolios and, where appropriate, properties that complement the existing asset base."

For more news and information visit Blumberg Capital Partners.