Case Studies.Class A Warehouse
Amazon Fulfillment Center.

Case Study: Build-to-Suit and Forward Takeout

Amazon Fulfillment Center – Pataskala, OH

Product

Class A Warehouse

Purchase Date

November 2016

Transaction Size

855,000
  • Challenge:
    • In 2015, GRT and Prologis began exploring ways to work together on future industrial development transactions through joint ventures and/or forward commitments
    • In July 2015, Prologis responded to a RFP from Amazon to construct a new sortable fulfillment center in Prologis Park 70 in Pataskala, OH. Prologis had recently closed on its acquisition of KTR Capital Partners which increased its concentration of Amazon tenancy, and Prologis was interested in finding a partner for the development and ultimate takeout of the property.
    • Given the multi-level mezzanines, additional power, and other specifications included in Amazon’s new state-of-the-art fulfillment center design, the total development cost was approximately $124 million, or $145 per square foot.
  • Resolution:
    • GRT partnered with Prologis to structure the transaction and negotiate the construction contract and lease with Amazon. Ultimately, GRT and Prologis agreed to fund $80 million of the $124 million total development cost and negotiated a 15-year lease with Amazon based on a 6.95% rent constant.
    • Construction commenced in Q4 2015 and GRT committed to acquire the property via forward commitment upon satisfactory completion of agreed-upon closing conditions.
    • GRT closed on the transaction in November 2016 for $88,896,060.
  • Benefits:
    • GRT collaborated with Prologis – an industry leader – to serve as a long-term capital partner for the world’s leading e-commerce company by creatively structuring a transaction to build and acquire a state-of-the-art next-generation fulfillment center.