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Highlights

Our Portfolio

GIP’s approximately 221,000/SF portfolio totals $48.3 million  (cost basis of assets) with an average weighted lease term of 6.1 years. 

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Cost Basis of Assets

Market Opportunity

A disproportionate number of net lease properties are privately owned. This market fragmentation implies an opportunity for public REIT buyers, such as GIP, to leverage scale and internal expertise to create value. 

We pursue often overlooked shorter-term leased assets with a high probability of renewal and the benefit of a 100-150 bps cap rate increase over similarly tenanted assets with a longer lease term. 

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Privately Owned Net Lease Assets

Extensive Underwriting

GIP conducts extensive research to evaluate target markets and properties, including a detailed review of the long-term economic outlook, trends in local demand generators, competitive environment, property systems and physical condition, and property financial performance.

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Initial Data Points Analyzed

PRATT & WHITNEY
JV CASE STUDY

THE OPPORTUNITY

  • Purchase an approximately 63,000 SF, single-tenant property occupied by Pratt & Whitney (At the time a subsidiary of United Technologies, NYSE: UTX. Now a subsidiary Raytheon Technologies, NYSE: RTX with a market cap of $94B and a credit rating with S&P: A-)

  • Tenant had recently renewed their lease for nine years with a termination option after four years - essentially a four-year primary lease term

  • Vacant land adjacent to the property was also available for purchase for future development and/or expansion

    • GIP UNDERWRITING

  • Rent for the tenant was slightly below market rate

  • Pratt & Whitney generated approximately $17B/year in revenue and $25MM at that location

  • The rent-to-revenue ratio for the location was approximately 3%

  • There was over $10MM of equipment at the location

  • The submarket for the location had a 0.00% vacancy rate, implying high demand for the asset in case of a vacancy in four years

    • THE JOINT VENTURE

  • GIP entered into a joint venture agreement for the JV partner to provide $2.2M of preferred equity)

  • The debt was sourced and guaranteed by GIP (not the JV partner)

  • GIP provided the JV partner a monthly cash return in addition to a deferred predetermined exit premium

  • The JV agreement was for two-years with an early exit option for the JV partner by paying the JV partner the deferred exit premium

    • THE OUTCOME

  • GIP created an SPE with the JV partner and purchased the asset which included an option to purchase the adjacent land within five years

  • GIP repositioned the JV partner equity and allowed for the JV partner to exit after twelve months and paid the deferred IRR at the time of exit

  • Raytheon reached out to GIPR to discuss an expansion of up to an additional 90,000 SF with a commensurate lease extension using the adjacent land that was optioned by GIP

    • Please fill out the form below to start a conversation with me about our JV opportunities!
    Emily Hewland
    Emily Hewland
    Director of Acquisitions