Wells Fargo Lends $414M on Ivanhoé Cambridge’s Warehouse Portfolio Acquisition

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Ivanhoé Cambridge, a Montreal-based commercial real estate manager, has secured a $414 million loan from Wells Fargo to finance the purchase of 120 American warehouses from TPG Real Estate, according to a Wells Fargo spokeswoman. The warehouses, formerly controlled by a subsidiary of TPG called Evergreen Industrial Properties, will join the portfolio of an Ivanhoé Cambridge real estate investment trust, IC Industrial REIT.

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The loan will remain on Wells Fargo’s balance sheet and pay off at a floating rate over five years, with two one-year extension options.

The warehouse portfolio, totaling 12.4 million square feet, comprises properties dispersed throughout the United States, with the biggest shares in Atlanta; Tampa, Fla. and Chicago. The portfolio is 91 percent leased and no extensive renovations are planned.

“We started looking at companies in the industrial real estate sector over two years ago with the intention of making a strategic investment in this asset class,” Ivanhoé Cambridge’s Arthur Lloyd said in a statement about the purchase. “Industrial real estate offers an attractive current return and good diversification for our office portfolio in terms of underlying economic drivers. We believe we have found the right fit with Evergreen.”

“All the fundamentals in the industrial space are very strong. That’s in a large part driven by e-commerce and the focus towards last-mile distribution for e-commerce retailers,” Kevin Cowan, of Wells Fargo, said. “This portfolio fits that mold. The [properties] are all in infill locations within their MSAs.”