Industrial Portfolio Sale Leaseback

Background: 

The Ascension Team represents a private equity backed leader in industrial aftermarket services. The company recently acquired an industrial equipment distribution and services company in Florida as an add-on to the existing platform company, and the transaction included a number of owned real estate locations. The Company engaged Ascension to run a sale leaseback process in order to generate proceeds to recoup a component of the sponsor’s equity investment in the add-on.  

Client Objective:

The client was looking to maximize proceeds from the sale leaseback and use the capital to return equity to the private equity firm, as a way to boost the returns on the add-on investment. The company selected Ascension as its advisor given Ascension’s extensive experience in the industrial middle market and robust investor network, which the client was confident would result in the best economic outcome for the business. Additionally, the client was impressed by Ascension’s tactful approach to lease negotiations on behalf of private equity firms, as the Ascension Team has a track record of achieving maximum flexibility for the sponsor when structuring sale leaseback transactions.  

Solution:

Ascension ran a competitive off-market investor outreach process, bringing in multiple qualified offers from interested parties. The team ultimately selected a public REIT to transact with, and closed the sale leaseback of the Jacksonville and Denver locations at a sale price of $20 million and a record low cap rate. The client was very excited about the outcome.