In this newsletter, I am happy to announce that we have acquired a flex-industrial property in Troy, Ohio, on May 29th. This property, located at 66 Industry Court, is a 28,700-square-foot flex-industrial building constructed in 1999. This deal was purchased by Flex Real Estate and its partners in 55 Industry Court RE, LLC, as an extension of our original business plan to buy and lease the adjacent building at 55 Industry Court. I wanted to share some quick notes on the transaction and why we are excited about the opportunity.
55 Industry Court and 66 Industry Court
The Opportunity
When we purchased the 45,000 SF building at 55 Industry Court, in November 2024, the property was considered 41% occupied with the seller vacating the other 59% at the end of December 2024. We underwrote an assumed downtime of twelve months to fill the vacant suite but were able to release the suite as soon as the other tenant's lease expired, resulting in no downtime. After lease-up, we were at an attractive basis and making robust quarterly distributions, which put us at a leverage point where we could acquire future opportunities within the same entity.
Next door to 55 Industry Court was a building that fit our thesis perfectly, containing five tenant suites, each with at least one roll-up door, and a simple layout that included both office and warehouse. When we received information on the property, we determined the rents in place were below market and could be increased over time. We also determined that, by refinancing our existing property at 55 Industry Court, we were able to acquire 66 Industry Court with no further cash contribution from investors, adding scale and upside to our investment. What started as 19,100 SF of occupied space in November 2024 has grown into 73,700 SF of fully occupied industrial space across two buildings.
66 Industry Court
Sourcing
This deal came to us off-market through a broker I had met in the Dayton Area named Matt Tunnacliffe, whom I had spoken with several times about Flex Real Estate's acquisition criteria and what properties he could get us access to at that time. Matt did a great job putting properties in front of us until he brought one that another team in his office was listing for lease, and we found out they may be willing to sell. When he presented the property at 66 Industry Court, I was excited because it was a building that I knew and had already thought would be a great addition to the Flex portfolio.
Positioning Within the Market and Future Troy Projects
The most exciting part about this acquisition is the position it puts us in to acquire more properties in the Troy market. Our favorable basis in this investment allows us to remain opportunistic and pursue similar projects, expanding our footprint as a tenant incubator and creating additional space options for tenants at different stages of growth. This submarket is a target for us due to its strong demographics relative to the Dayton MSA, its access to I-75, and its robust manufacturing activity.
Downtown Troy, Ohio
Overall, this is a great acquisition for our investors in 55 Industry Court RE, LLC and a big step in the growth of Flex Real Estate. I am happy to be able to share some of the details of this acquisition with all of you and, as always, I am looking forward to the next one.
Reply to this email and let me know if there are any specific topics you would like to hear about next. Thank you for reading, and stay tuned for the July Focus!
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