The real estate investment platform RealtyMogul launched an offer for an industrial center in Detroit.
The Gateway Industrial Center is a value-adding equity investment in a manufacturing, assembly and logistics facility. Project sponsor Innovo Development Group purchased the property in January 2020 for $94.5 million with less than 50% occupancy. Innovo is in the process of building an addition to the northwest corner of the complex, adding 421,000 square feet to the facility.
The supply and demand imbalance for producing buildings on this scale should facilitate a friendly environment for signing tenants and achieving the 100% occupancy goal. The Detroit industrial market is experiencing unprecedented rent growth while maintaining one of the lowest vacancy rates in the Midwest.
The addition is expected to be completed in December when the project will begin accepting investments through RealtyMogul.
The project is located at the intersection of Interstate 96 and Southfield Freeway in Detroit. The new building at Gateway will have 62 truck docks with 36-foot ceilings, heavy duty power suitable for electric vehicle battery requirements and more than 100 trailer parking spaces.
“Gateway is designed to accommodate both manufacturing and distribution tenants,” according to Innovo Development Group.
- Minimum investment: $35,000
- Target internal rate of return (IRR): 24.1%
- Target stock multiple: 1.7x
- Target cash yield: 9.7%
- Target investment term: three years
Facility owner Innovo Development Group has developments across the country, including several projects in the Midwest and Florida. Since the group’s inception, it has developed and managed more than $738 million in assets.
The group manages assets across multifamily, industrial and retail classes and has extensive experience in the Midwest and Detroit markets.
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Photo courtesy of RealtyMogul