Gladstone Buys Industrial Asset, Boosts Indianapolis Portfolio

Gladstone Commercial Corporation GOOD recently announced the acquisition of an industrial property in Indianapolis, IN. The move is in sync with the company’s efforts to fortify its portfolio on high-quality assets in thriving markets with credit-worthy tenants.

The 231,509-square-foot industrial building is fully leased to Javo Beverage Company, with a remaining lease term of 13.5 years. For the tenant, the property is mission critical, functioning as manufacturing and distribution facility for Javo’s coffee and tea beverages, extracts, and flavors. It also enjoys solid access to major transportation routes. This is likely to ensure steady returns from the property.

Notably, Gladstone Commercial has been making encouraging moves to bolster its property base in the Indianapolis market, in a bid to bank on upbeat market trends. In fact, the latest acquisition marks the company’s third purchase in the market, and the second industrial acquisition in Indianapolis this year.

As part of its capital-recycling program, the company is aimed at selling of non-core assets and use proceeds to de-lever its portfolio as well as acquire properties in the stronger target-growth markets. Gladstone Commercial’s acquisition pipeline and closings in the year so far look good for its industrial properties.

The portfolio expansion will likely help fuel growth, as high consumer spending, e-commerce boom and a healthy manufacturing environment amid resilient economy and healthy job market are spurring demand for the industrial real estate category. This is highly encouraging for Gladstone Commercial, as well as other REITs, including Duke Realty Corp. DRE, Prologis PLD and Rexford Industrial Realty, Inc. REXR.

As such for Gladstone Commercial, which is focused on investments in mission-critical facilities occupied by middle market to investment-grade businesses located in growing markets, the latest acquisition will likely be accretive to its earnings and drive long-term growth.

Shares of Gladstone Commercial have outperformed the industry it belongs to in the past six months. This Zacks Rank #3 (Hold) company’s shares have gained 5.1%, while the industry recorded growth of 4.5% during the same time frame. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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