D2 Organization Completes Major Sale of Logistics Development
D2 Collins LLC, part of the D2 Organization, has successfully sold an impressive 707,400 square foot logistics park development to EQT Real Estate, a top investor in the industrial and logistics property sector. This transaction highlights D2's commitment to realizing value through strategic land investments and provides EQT with a premium development opportunity in a flourishing market.
Details of the Logistics Park Development
The newly acquired 48-acre site will host a Class-A modern logistics park and is designed to include three substantial buildings, specifically Building A at 178,500 square feet, Building B at 254,500 square feet, and Building C at 274,400 square feet, all equipped with ample parking for cars and trailers.
Location and Infrastructure
This prominent site is situated at 1, 3, 4, and 7 Collins Drive within the Salem Commerce Park. The land comprises a combination of parcels, totaling 35 acres from three vacant parcels at 3, 4, and 7 Collins Drive, alongside a 10-acre parcel at 1 Collins Drive featuring a previous 78,000-square-foot office building. This strategic acquisition allows for a substantial logistics hub in an area with promising growth potential.
Strategic Partnerships and Growth Potential
Tom Allman, the Managing Director of Construction & Development at US Industrial EQT Real Estate, expressed excitement about collaborating with local stakeholders again on this venture. Key partners involved in the project include D2 Organization, Marathon Engineering, Archer & Greiner, and CBRE.
Initially, D2 obtained full entitlements on the vacant land for three Class A warehouse buildings, amounting to 586,000 square feet. Following acquisition, the company partnered with local officials to secure approvals that expanded the buildable area to 707,400 square feet by redefining Building C's footprint while addressing the future demolition of the old office building.
Benefits of the Development
The logistics park's site enjoys the advantage of an approved Payment in Lieu of Taxes (PILOT) agreement with local authorities, which will reduce tax obligations and operational costs, making the development even more attractive to potential tenants.
A Testament to D2's Market Commitment
Keith Delaney, CEO of D2 Organization, emphasized the sale as a strong indicator of their focus on this sub-market and the effectiveness of their team in navigating through the complexities of obtaining necessary entitlements.
The strategically located Salem Commerce Park is ideally positioned near major thoroughfares, just off Exit 4 at the Interstate 295 and Highway 48 interchange. It is conveniently located within a short distance to essential transport links such as Interstate 295 and the New Jersey Turnpike, further solidifying its viability as a prime logistics hub for local operations and wider distribution needs.
The site's proximity to major urban areas, including Philadelphia, Southern New Jersey, and Northern Delaware, provides advantageous access for companies needing connections to New York City, Baltimore, and Washington, D.C. The presence of crucial logistics facilities nearby, such as the Port of Wilmington and PHL International Airport, enhances its attractiveness even further.
Impact on Local Market Trends
Since 2019, D2 has successfully entitled over 3,000,000 square feet of industrial project developments in showings. During this time, the rents in Salem County for Class-A industrial space have seen a significant uptick, increasing from around $5 per square foot to above $12 per square foot, a clear indication of the high demand in the region.
Collaboration and Representation
Representing D2 in this significant transaction was CBRE's National Partners team led by Brian Fiumara. Notably, the Southern NJ/Eastern PA metropolitan area has emerged as the second largest big-box region in North America, boasting substantial warehouse capacity with over 500 million square feet of inventory.
About D2 Organization
D2 Organization is a privately held investment group dedicated to transforming undervalued properties into thriving assets that stimulate economic growth. Their focus is on acquiring and repositioning land to create new development opportunities, with a portfolio exceeding 1,000 acres sold for over $200 million to institutional investors.
About EQT Real Estate
EQT is a global investment organization managing EUR 269 billion in total assets. Their Real Assets segment focuses on acquiring and managing logistics and residential properties across the Americas, Europe, and Asia, maintaining over 2,000 properties and 400 million square feet globally.
Frequently Asked Questions
What is the size of the logistics park developed by D2 Organization?
The logistics park spans 707,400 square feet and will feature three separate buildings.
Who acquired the development site from D2 Organization?
The site was acquired by EQT Real Estate, a prominent investor in logistics and industrial properties.
What benefits does the development site offer?
The site includes a PILOT agreement that helps minimize taxes and operating costs, making it attractive to potential tenants.
What is the significance of the location for the logistics park?
The site is strategically located near major highways and urban areas, enhancing accessibility for logistics operations.
How has the market for Class-A industrial space changed recently?
Rents for Class-A industrial space in Salem County have more than doubled, indicating strong demand in the market.
