PGIM originates $455m refinancing for SoCal industrial portfolio

Alere to use funding to recap assets across Los Angeles, Orange County and the Inland Empire.

PGIM Real Estate this week originated a $455 million fixed-rate refinancing package for an eight-building Southern California industrial portfolio owned by Alere Property Group.

The September 13 financing on behalf of the Newark, New Jersey-based manager’s core lending strategy will be used by Newport Beach, California-based developer and owner Alere to recapitalize assets across Los Angeles County, Orange County and the Inland Empire.

The financing tracked with PGIM’s recent lending focus areas, which include stable asset categories such as industrial and multifamily, and often skew toward refinancing with acquisition activity tapered down across the commercial real estate industry. The refinancing for Alere tacks on more exposure for PGIM in regional markets that have ranked high on a national basis for the stability of their occupancy rates and comparatively low vacancy rates.

Trent Brown, PGIM Real Estate’s executive director, who led the financing on the manager’s behalf, said the core lending strategy has allowed PGIM to consistently invest in the industrial sector, especially in Southern California where bulk distribution properties remain in high demand. “We remain bullish on the industrial asset class despite headwinds in some real estate sectors and parts of the greater economy,” he said.

The 3-million-square-foot portfolio includes Class A buildings that range in size from 50,000-900,000 square feet. PGIM noted all the buildings are located in infill locations near major freeways. Chicago-based advisory JLL brokered the transaction with Brian Halpern, a managing director at JLL, helming the capital markets team for this deal.

Melissa Farrell, head of US debt originations at PGIM Real Estate, told Real Estate Capital USA this week that the firm’s pipeline is primarily geared toward industrial and multifamily deals at present. The firm has been seeing more large loan opportunities in recent quarters because of the pullback of national bank lenders and regional bank lenders.