Positioning a market leader in a niche asset class to secure $800M seed investment
JLL Securities and Capital Markets teams combined their expertise to structure a joint venture between two major real estate investment firms, driving high future growth
The ambition
Real estate investment and management firm, Arden Group, wanted to expand its 7 million square foot portfolio of 30 industrial parks with over 200 buildings and 1,100 tenants across nine markets in Florida, Georgia, Indiana, North Carolina, Ohio, Pennsylvania, and Texas.
Although the group’s vertically integrated business has consolidated a strong competitive position in its market, managing such huge assets spread over vast distances can be complex, particularly for a niche asset class of industrial-focused real estate with in-house property management. On top of that, to secure financing for expansion, the firm would need to form a partnership, which could carry risks such as increased liability.
Arden Group sought financial advisors with expertise in debt financing and capital markets to structure the right solution.
The strategy
The JLL Securities and Capital Markets teams valuated each of Arden Group’s numerous assets to structure transparent pricing for the portfolio. Where our Securities team advised Arden on the formation of a joint venture and financing for acquisitions, the JLL Capital Markets team supported the transaction with comprehensive financial advisory.
Arden has built a best-in-class multi-tenant focused industrial platform, and we are very pleased to have advised both Arden and Arcapita in forming what we are confident will be a successful partnership. We are excited to see the venture grow further from here.
The teams then leveraged JLL’s deep research platform to accurately position Arden as a best-in-class, multi-tenant-focused industrial platform, and to educate investors on the opportunities in this asset class.
This comprehensive marketing process presented Arden’s seed portfolio to over 100 potential partners and cycled through multiple negotiation rounds.
The results
The JLL teams secured the Arden Logistics Park joint venture between Arden Group and Bahrain-based global asset manager Arcapita Group, seeded with an $800 million portfolio of multi-tenant warehousing.
Arcapita committed capital investment that enabled it to acquire a 49% interest, with the near-term goal to grow $2 billion in gross asset value.
Meanwhile, the JLL teams’ methodical approach provided liquidity for Arden’s existing limited partnerships, enabling the annulation of existing debt, and created securities reserves that can be readily deployed to grow the joint venture, with high potential for returns.
By navigating a volatile market and maximizing investor interest in a niche asset class, JLL’s teams secured a large amount of financing for Arden Group and structured a high-yielding, long-term partnership that now has an accelerated path to compelling strategic possibilities, including a potential IPO.
By navigating a volatile market and maximizing investor interest in a niche asset class, JLL’s teams secured a large amount of financing for Arden Group and structured a high-yielding, long-term partnership that now has an accelerated path to compelling strategic possibilities, including a potential IPO.
Securities brokerage services are provided by Jones Lang LaSalle Securities LLC (“JLLS”), member of FINRA/SIPC. HFF Securities LP merged into JLLS on July 1, 2021. Services offered by JLLS include capital raising, mergers and acquisitions, corporate advisory, credit tenant loan activity, municipal securities and municipal advisory services.
