The Bixby Bulletin
2020 Takeaways and Industrial Insights with Bixby Portfolio Manager, Bill DeLaney
At the beginning of 2020, one major market factor on peoples’ minds was the election, however, nobody anticipated the year that was about to unfold. Accustomed to the ebbs and flows of the commercial real estate world, Bixby Land Company kept its dynamic industrial acquisition strategy at the forefront with the objective to stay active and execute on the right opportunity. When the pandemic hit, the team held strong to this strategy, relying on its core values of teamwork, integrity, focus, discipline and execution as its founders did during the Depression and the 1933 Long Beach earthquake nearly a century ago. This sense of purpose, perseverance and diligence is what has allowed Bixby to expertly build its portfolio of high-functioning industrial real estate properties over the years, and 2020 is no exception. With e-commerce sales in the U.S. up 37.1% to $199.44 billion in the third quarter of 2020, compared to 2019, Bixby has remained active in the increasingly attractive space. Bill DeLaney, Portfolio Manager for Bixby Land Company, shares that Bixby closed on four properties totaling nearly one million square feet in key Georgia markets this year, including three properties in the Savannah Market and one in Atlanta’s Airport/I-85 South Submarket. Among Bixby’s strategic advantages to maintaining momentum in the highly competitive industrial market include its deep, long-standing relationships with the broker community and an intense vetting process. Combining elaborate research and a stringent checklist, the Bixby team is extremely selective when it comes to asset purchases. “We buy buildings with characteristics that the current industrial user base will need on a go-forward basis,” DeLaney shares. “There's a lot of product out there that is increasingly becoming obsolete as they don’t have the site and building characteristics required of today’s industrial users.” Examples of this include buildings that have inadequate clear height, parking and truck court depths, dated sprinkler systems and/or insufficient trailer doors. How is Bixby different? “It’s our ability to assess and acquire real estate that will be functional for the future and that companies will want to occupy.” DeLaney says. A testament to this, Bixby was able to fully lease it’s off-market purchase of 200 Nordic Drive, a 229,000-square-foot, vacant Class A property in Pooler, GA, before the sale even closed. Within five miles from Savannah/Hilton Head International Airport and 10 miles of the Port of Savannah, Bixby was able to spot those strong economic dynamics and strike at the right time. 95 Logistics Center, the multi-building Savannah Industrial Market property that Bixby acquired this year, was first spotted as part of a larger portfolio that also included properties in Lakeland, FL and Charlotte, NC. Together with its equity partner, Bixby was able to parcel off just the property that it wanted at an attractive basis. “What was so impressive about the acquisition of 95 Logistics Center was our team’s ability to successfully coordinate with vendors, consultants, lenders and lawyers, quickly, efficiently and remotely to close on a newly constructed, best-in-class asset with great tenants,” DeLaney says. The last of the four properties acquired, Aerotropolis North in Atlanta is in another prime location–about two miles from Hartsfield-Jackson Atlanta International Airport–that was also purchased vacant off-market, with a venture partner. Far from coincidence, Bixby’s tendency to seek vacancies has paid off, literally. “We've been able to buy quality, well-located real estate and ultimately stabilize it to a return that we otherwise wouldn't have been able to acquire it at,” DeLaney explains. Adding to its ability to transact in less-than-ideal circumstances, the company also completed nearly 2 million square feet of leases in 2020. Highlights include stabilizing recent vacant acquisition purchases in Georgia and Texas. The newly constructed Class A rear-load distribution building at Graham Logistics Center in greater Atlanta, which was purchased vacant at shell completion in 2019, had its remaining vacancy of nearly 200,000 SF leased this year. The 271,794-square-foot cross-dock building at Parkway Logistics Center located in the Dallas Fort Worth region was also leased to three tenants. With its mix of new acquisitions in major markets, new leases and lease renewals, Bixby’s industrial portfolio growth and accounts receivable (AR) has been remarkable, relative to the industry average, this year. In looking at 2021, DeLaney shares that it’s important to constantly keep in mind and ask how people will be using commercial real estate in the future. “Doing your due diligence and remaining proactive to understand constantly changing market dynamics, what tenants are looking for, and then, being able to pivot and change is a hallmark of Bixby’s. It’s where we really add value for our equity partners and shareholders,” DeLaney says. This year, the company has once again proven its expertise in dealing with the ebb and flow of the real estate industry. With a long-standing legacy and deep roots in the commercial real estate industry, Bixby Land Company continues to show that it’s grounded not in its way of doing things, but in its mission to pioneer exceptional value through dynamic real estate. While the landscapes may be different for now, the team remains nimble, receptive and, of course, ready to execute on the right opportunity.
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