Bank OZK, PGIM Provide $76M Construction Loan for Houston Cold-Storage Facility
FreezPak and BG Capital have formed BGFP International to develop three domestic cold-storage facilities
By Brian Pascus October 30, 2023 12:44 pm
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FreezPak Logistics, a dry goods and cold-storage transportation services firm, along with partner BG Capital, a Pennsylvania-based real estate developer, have secured $75.9 million in construction financing to build a 282,000-square-foot cold-storage facility outside Houston, Commercial Observer has learned.
The two firms have combined their businesses as BGFP International for the deal. The strategic partnership has already secured $200 million in total investment for three cold-storage projects across the U.S.
Bank OZK (OZK) provided $50 million in senior construction financing, while PGIM Real Estate provided $25.9 million in mezzanine construction financing. All in, this phase of the project is expected to require $100 million in investment capital.
Daniel Kattan, an executive director of PGIM Real Estate, said the deal highlights his firm’s “growing capabilities” within the structured debt space.
“The industrial and logistics sector continues to be a core competency of PGIM Real Estate’s debt platform, and we’re pleased to have supported BG Capital and FreezPak’s financing needs for this asset near the Port of Houston,” Kattan said in a statement.
This is the second of three projects for BGFP International. A 172,000-square-foot cold-storage facility in Philadelphia is expected to deliver before the end of the year, while a third cold-storage facility in Jacksonville, Fla., will break ground in the months ahead.
Located at 7818 Fisher Road, Baytown, Texas near TGS Cedar Port outside Houston — a large-scale, master-planned, regional rail and barge industrial park — the new BGFP International cold-storage facility is expected to feature cooling equipment, hydrogen fuel cell technology, and heavy machinery. The $75.9 million loan will fund the first phase of the project, which is expected to cover more than 543,000 square feet across two phases of development. The total cost was not reported.
“We believe this two-phase project, situated by the fifth-largest port in the US, is a great addition to the Cedar Point Industrial Park, and we are happy to be a part of it,” said Joseph Byrne, managing member of BGFP International and co-founder of BG Capital.
FreezPak co-founder and CEO David Saoud, also a managing member of BGFP International, said the Houston project plays into FreezPak Logistics’ goal of establishing a presence in every major domestic port by 2030.
“It’s crucial to emphasize that the cornerstone of achieving this objective lies in tailored build-to-suit projects, as speculative development falls short in meeting the unique needs of [third-party-logistics] companies,” Saoud said in a statement.
Brian Pascus can be reached at bpascus@commercialobserver.com
