As published in CoStar News By Cara Smith-Tenta

Affiliates of investment firm Phoenix Investors said it acquired a portfolio of industrial properties divided between Kentucky and Pennsylvania, which CoStar analysts describe as “booming” logistics markets that could emerge from the coronavirus pandemic “relatively unscathed.”

Phoenix Investors, a commercial real estate investment firm based in Milwaukee, bought four industrial properties totaling 1.76 million square feet in the greater Lexington, Kentucky, and Pittsburgh, Pennsylvania, metropolitan areas, according to a statement from Phoenix Investors and CoStar research.

Ledvance, a lighting manufacturing company based in Germany, sold the properties. The company was acquired by the Chinese lighting company MLS in 2018.

The sale price was not disclosed and it is unclear whether Ledvance still occupies the properties. Ledvance and Phoenix Investors did not return requests for comment. Newmark Knight Frank, which brokered the sale, also did not return requests for comment.

The properties sit in two growing metropolitan areas with strong industrial prospects, even amid the coronavirus pandemic. Lexington’s industrial market is “booming,” Brandon Frankel, market analyst for CoStar, wrote in his most recent report on the city’s industrial market. It boasts a tight vacancy rate of just 2.6%, which is well below the national average of 5.6%, according to CoStar research.

The city’s relative lack of free land for development, combined with the national trend of more companies needing distribution centers, has kept Lexington’s industrial market strong throughout the pandemic, Frankel wrote.

In Pittsburgh, a slew of the nation’s largest manufacturers, including U.S. Steel, Kennametal and PPG Industries, have outposts in the city, Ben Atwood, market analyst with CoStar, wrote in his most recent report on the city’s industrial market.

The city has historically been difficult for large-scale developers due, in part, to the constraint of available space in the region. But he said Pittsburgh’s relative lack of overgrowth from e-commerce users could insulate it in the coming months.

The Pittsburgh “industrial sector might come through the pandemic relatively unscathed,” Atwood wrote in his report on the market.

Phoenix Investors’ new four-property portfolio is composed of the following buildings:

  • 900-1000 Tyrone Pike, a 813,073-square-foot industrial property that sits in Versailles, Kentucky in the greater Lexington area. That property is 100% leased, according to CoStar research.
  • 435 E. Washington St., a 204,500-square-foot industrial property in Winchester, Kentucky, also within the Lexington metropolitan area. That property is 100% leased, according to CoStar.
  • 835 Washington St., a 421,721-square-foot industrial property in Saint Marys, Pennsylvania, which sits in the Pittsburgh metropolitan area. The property is 0% leased, according to CoStar.
  • 1 Jackson St., a 326,185-square-foot property that sits in Wellsboro, Pennsylvania, also within greater Pittsburgh. The property is 100% leased to several tenants, including Osram Sylvania, a subsidiary of Ledvance that occupies 296,756 square feet, according to CoStar research.

For the Record

Newmark Knight Frank’s Jim Belcher and Bart Hardison brokered the deal, according to the statement from Phoenix Investors.