Bridge Logistics Grabs Fontana Industrial Buildings

A Bridge Investment Group Holdings affiliate has made a move to get beyond the backlash against industrial development in California with a deal for three distribution centers in the Inland Empire.

“Local municipal headwinds, AB 98 and general land scarcity are causing significant barriers to new development,” Paul Jones, managing director of Bridge Logistics Properties, said in a statement, referring to the state law passed last year standardizing warehouse design, truck routing and air quality monitoring for logistics developments across the state. “Once economic conditions stabilize and tenant demand normalizes, we believe we will see value appreciation for existing assets.”

Bridge Logistics Properties, a subsidiary of the Salt Lake City-based investment firm, bought the three industrial buildings in Fontana for $83.5 million, L.A. Business First reported, which comes to about $250 per square foot.

That’s about double the price that several Class A office buildings in downtown Los Angeles have fetched over the past year or so.

The 332,800-square-foot industrial portfolio includes a 100,000-square-foot building at 14074 Rancho Court; a 57,650-square-foot building at 14019 Rose Avenue; and a 175,100-square-foot building at 14928 Washington Drive. The Rancho Court and Rose Avenue buildings are next to each other while the Washington Drive location is about two miles northeast. The buildings’ previous owners were not disclosed.

Each building is fully leased and features 32-foot clear heights, secured truck courts, early suppression fast response sprinkler systems, LED lighting and dock-high and grade-level loading, according to L.A. Business First.

Inland Empire West is one of the biggest logistics markets in the country with more than 651 million square feet of total inventory as of the second quarter, according to Colliers’ Q2 report on the I.E. industrial market. Vacancy was 6.8 percent last quarter with 10.7 million square feet under construction.

Bridge Logistics is coming off securing a $354.6 million loan from Invesco Commercial Real Estate Finance Trust to refinance a 24-asset industrial portfolio last month. The 2.4 million-square-foot portfolio includes buildings in California, Texas, New York and New Jersey and is “well-leased” and generating cash, Charlie Rose, Invesco global head of credit, told Commercial Observer.

— Chris Malone Méndez