Everview buys 85-building Tucson industrial portfolio for $165.75 million

Everview Partners has bought an 85-building industrial portfolio in Tucson for $165.75 million, taking 14 properties and 1.25 million square feet from a Pegasus Tucson Owner LLC entity associated with Equus Capital Partners, and the price begins to make sense only against the 2021 basis those same buildings carry. The portfolio was roughly 90 percent leased to 452 tenants when it sold, which implies something on the order of 125,000 square feet of unleased space — a load that lands differently in shallow-bay product, where the income comes from a 452-name roster rather than one or two credit tenants. The buildings mix warehouse, office and flex space across corridors running from Forbes Boulevard to East 29th Street.

Real Estate Daily News reports that Equus-sponsored funds acquired the properties in October 2021 for approximately $150 million, which puts the markup on this sale at $15.75 million, about 10.5 percent across five years — a shade over 2 percent a year in raw value. No cap rate was reported, so the trade clears on the arithmetic of basis: roughly $132.60 a square foot against an average tenant footprint of about 2,765 square feet, the granularity that defines shallow-bay and the reason a buyer of this portfolio is underwriting a leasing operation as much as a set of buildings.

The assignment was worked by Cushman & Wakefield's National Industrial Advisory Group — Will Strong, Michael Matchett, Madeline Warren, Molly Miller and Jack Stamets — alongside Paul Hooker of Cushman & Wakefield | PICOR, who represented both sides.

This publication has argued that a global construction freeze pushed large managers from acquisitions toward development, on the reasoning that standing product has grown too expensive to buy. Tucson's shallow-bay stock complicates the second half of that claim at the small end of the market, where 85 tenanted buildings changed hands barely 10 percent above a 2021 basis in warehouse, office and flex space rather than any land component. Infill Sun Belt industrial of this vintage and granularity still clears on in-place cash flow, though a single trade in a single market settles nothing about pricing nationally.

Everview arrives with capital behind it, with PRED's records showing a $1.7 billion fund launched on September 28 and an announced $2.3 billion deal in the same window, though neither is tied to this purchase. If the Tucson portfolio is coming out of that fund, $165.75 million spread over 14 properties would be a modest first slice — which is what assembling a shallow-bay position market by market looks like at the outset.

The open question is what 10 percent vacancy and the office-and-flex component are worth under Everview's underwriting, and the answer will show up in Tucson leasing comps before it shows up in the next portfolio price.