NEW YORK CITY — Brookfield Property Partners LP (NYSE: BPY) has agreed to acquire Atlanta-based Industrial Developments International Inc. (IDI) from the U.S. unit of Kajima Corp. for $1.1 billion. The transaction will add 75 distribution facilities totaling 27 million square feet to Brookfield’s industrial portfolio.
IDI also brings to Brookfield its 49 million square feet of future development projects and third-party property management business. The corporation’s properties are located in several key industrial markets in 12 states. Among the markets IDI has a presence in are Chicago, Cincinnati, Memphis, Dallas/Fort Worth, New Jersey, Atlanta and Ft. Lauderdale, Fla.
Following the acquisition, Brookfield’s industrial portfolio will total 62 million square feet, plus 79 million square feet of future development potential.
“The addition of IDI to Brookfield’s existing industrial operations will create a leading global industrial real estate company able to deliver high-quality distribution facilities to clients around the world,” says Ric Clark, CEO of Brookfield. “The combined business will own irreplaceable assets and development sites near major markets and transport routes, with a 25-year track record of delivering superior service, and is now positioned for significant long-term growth.”
As a result of the transaction, which is expected to close in the fourth quarter of this year, Brookfield Property Partners will own approximately a 25 percent interest in IDI, with the remainder owned by Brookfield’s institutional partners.
After leaving Australian real estate franchise LJ Hooker in the late 1980s, IDI founder Greg Gregory shopped the idea of an industrial development company and eventually realized his vision as a wholly owned subsidiary of Japan-based Kajima. With the parent organization’s support and financial contacts, IDI flourished, and the company’s leaders expect that trend to continue under a new umbrella.
“Brookfield will be an exceptional parent organization, and we are enthusiastic about starting a positive new chapter for IDI as we approach our 25th year in business,” says Timothy Gunter, IDI president and CEO. “With Brookfield’s backing, we have an exciting opportunity ahead of us to strengthen IDI’s presence in the current markets we serve and potentially in uncharted territory.”
A relatively recent spin-off of Brookfield Asset Management, Brookfield Property Partners was launched in April to focus exclusively on ownership of commercial properties. Since the stock of Brookfield Property Partners began trading on April 13, the share price has fallen from a high of $22.77 on May 8 to $20.20 on Aug. 7.