Twinbridge Industrial Park in Pennsauken — Courtesy: Wharton Industrial
By Joshua Burd
Wharton Industrial and Walton Street Capital have sold a 1.3 million-square-foot industrial portfolio in Pennsauken for nearly $195 million, the firms announced Thursday.
The partners, which are based in New York City and Chicago, respectively, completed the deal some three years after their purchase of what’s now the 37-building Twinbridge Industrial Park, citing the strength of the Philadelphia market. The property is 15 minutes from Center City, they noted, while touting the $194.5 million transaction as one of New Jersey’s largest industrial deals this year.
An affiliate of New York-based DRA Advisors purchased the portfolio, which sits at the junction of routes 130 and 73.
“With over 50 tenants at Twinbridge, there was legitimate concern as to the sustainability of the tenancy,” said Peter C. Lewis, founder and chairman of Wharton Industrial, a platform company of Wharton Equity Partners.
“Despite others who were fearful of investing at that time, we saw the portfolio as prime real estate that we believed would weather economic uncertainties,” Lewis added. “Supporting our belief were the low vacancies in the market, tightness of supply, proximity to Philadelphia and the diversity of tenants (many of whom were long-term occupiers providing essential services). Our intuition was greatly rewarded, with rents increasing more than 100 percent during our three-year hold, through strategic property improvements and extensive leasing management.”
Wharton said the Twinbridge transaction achieved an internal rate of return of roughly 80 percent. And the deal follows the partnership’s move to reposition a nearly 300,000-square-foot, derelict former subway repair facility in South Philadelphia, which it subsequently leased to Amazon and sold for an IRR of more than 200 percent.
Lewis noted that the Twinbridge assets had similarly been disregarded by the local investment community when Wharton and Walton purchased the portfolio in 2020, in the throes of the pandemic.
“Although there was risk in pursuing a sale in this climate, we believed that the quality of the properties, the growing interest in small bay industrial and the fact that there would be limited competing properties on the market would outweigh any headwinds,” Lewis added, thanking Walton Street and brokers Brad Ruppel, Mike Hines, Liam Fahey, Marc Isdaner and Ian Richman.
“We are obviously very pleased with the outcome.”
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