Michelin-leased distribution facility in Chicago sells for $135m

Michelin-leased distribution facility in Chicago sells for $135m
Image:Courtesy of GFH

Bahrain-based investment firm GFH Financial Group has acquired a distribution facility in Chicago, Illinois for US$135 million.

The real estate asset has been leased since November 2015 to blue chip tenant Michelin North America. The transaction was undertaken in partnership with Silver Creek Commercial Development LLC.

The distribution facility is one of only two bulk logistics centres used by Michelin in the US, handling 35% of the company’s imported inventory and therefore sitting at the heart of its US operations. 

“With this transaction, we continue to further our efforts to diversify and expand  our portfolio of international, blue chip real estate assets. This includes new acquisitions of prime properties in strategic geographies for us including the US,” said Razi Al Merbati, CEO of GFH Capital S.A. 

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The distribution facility is situated at the intersection of I-55 (Chicago to Louisiana) and I-80 (New York to Northern California) offering seamless access to major interstate highways.

Its close proximity the BNSF Logistics Park Chicago, a transport hub linking manufacturers with rail, road and ocean links, and the UP Joliet Intermodal Facility. Respectively, these transport centres handle approximately six million TEUs annually, ranking third in the US by activity, lagging only behind the Ports of Los Angeles and Long Beach in terms of total US container volumes.

”This is especially true in the distribution and logistics segment today, where demand is strong for well-located facilities close to major urban centres and populations that require faster and more seamless access to goods. With this deal, we move further towards solidifying our position as a leading real estate investor in the US and look to transact on the strong pipeline of other unique opportunities we have in place,” Razi Al Merbati added.

”The Chicago-based facility is uniquely positioned in the centre of the country and boasts seamless access to a variety of transport links giving tenants easy access to their customers located across major US states and commercial centres. This investment is supported by its long-term lease to Michelin N.A, a highly reputable tenant and global tire industry giant, who has helped establish and maintain the facility as a state-of-the-art distribution centre,”  added Salem Patel, Head of Asset Management, at GFH.