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Business Brief: Why Plymouth Is Doing $97 Million Southside Business Park Deal

exterior of business park
Jacksonville Daily Record
Boston-based Plymouth Industrial REIT Inc. is buying a portfolio that comprises three business parks – Center Point Business Park, Liberty Business Park and Salisbury Business Park.";

Plymouth Industrial REIT Inc. intends to continue investing in Jacksonville after it completes the $97 million acquisition of 20 Southside buildings in mid-December.

“Jacksonville has now kind of come out from under the shadow of Miami and Atlanta and stands on its own,” President Pendleton White said Thursday.

“It has a lot of things going for it.”

The properties total about 1.1 million square feet of light industrial and flexible-use space near I-95 and Butler Boulevard.

White said Boston-based Plymouth has been considering Jacksonville for several years. 

“We like the fact it is a growing city,” he said, citing the industry mix that includes the military, medical centers, financial services and logistics.

White called Jacksonville an affordable city with a cost of living lower than markets like Miami and Atlanta.

He said the expanding transportation system, the deepening of the St. Johns River and the growth of the port also are drivers. “It’s a business-friendly environment,” he said.

White expects growth to continue, along with investment by Plymouth.

“We are looking to acquire additional properties as well, so we expect to have a pretty solid presence in the Jacksonville area,” White said.

He said Plymouth holds its properties for the long term rather than selling off in several years. 

“We invest for cash flow for our shareholders,” he said. “We are not like a private equity fund where we need to sell in five or six years,” he said.

Plymouth is buying the portfolio from Connecticut-based Greenfield Partners LLC, which acquired the buildings as part of a larger acquisition from Liberty Property Trust five years ago.

The I-95 and Butler Boulevard area was a factor in the deal.

“We think this particular location could not be any better,” White said. He cited the businesses moving into the area as well as the thousands of apartments being developed in the vicinity.

White referred to it as the “State and Main” of the area because of its central location of traffic corridors and access to jobs, housing and amenities.

He said there isn’t a lot of land left for development of flex and light industrial space in the I-95 and Butler Boulevard area, which makes the properties attractive to tenants.

He said that as Plymouth was in due diligence, it found a theme among tenants.

“The tenants were there because of the location and the quality of the product,” he said.

Tenants told him their employees preferred the location. With the challenges of finding staff during an era of low unemployment, workforce retention is critical, he said.

Another driver in the deal was the area’s record low vacancy rate of 3 percent and lower among industrial properties. That has been leading to higher rental rates, which is positive for landlords.

White, also chief investment officer, did not say where the next investment could be in Northeast Florida.

He said Plymouth’s overall portfolio was about 11 million square feet, with about half of that with multitenant properties. Its focus is in the 150,000- and 400,000-square-foot range for buildings.

It invests primarily in secondary and select property markets across the U.S.

White said Lingerfelt CommonWealth Partners will continue to manage and lease the Jacksonville properties. 

The buildings are among three business parks – Center Point Business Park, Liberty Business Park and Salisbury Business Park.

The properties are 96 percent leased to 40 tenants including Comcast, Cintas, Veritiv, Staples, The Home Depot and Safelite AutoGlass.

The listing broker was Colliers International in Jacksonville and Atlanta, he said.