Elm Grove-based
Luther Group LLC is continuing its acquisition binge of industrial properties with more buildings and a development site in New Berlin.
Luther Group said that with these acquisitions, it has surpassed $100 million of assets under its control.
According to state records, Luther Group affiliates purchased four properties last week for $14.55 million.
Three of them are located along Beloit Road, a 70,000-square-foot building at 16100 Beloit Road occupied by Spincraft, a piece of land south of the Spincraft building, and a 10-acre vacant site to the west of Spincraft at 16230 W. Beloit Road.
The final site is located at 2917-37 S. 166th St., and is being leased to T-Mobile and Alside Supply Center.
"It's humbling to even think about, but we crossed $100 million of assets," Jason Luther, president and manager of Luther Group, said of the milestone. "Though there's a fictitious line that exists there, you kind of get a chance to take a step back and look at it. We have such an amazing team and partners that have allowed us to get here."
Luther Group has placed the Spincraft building, the neighboring land and the 166th Street building into an investment fund.
The company will develop the remaining Beloit Road site. Luther said he's looking to build a 75,000- to 100,000-square-foot building there. Luther Group will develop the site either on a speculative basis or as a build-to-suit project.
Luther said the investment fund is halfway to meeting its objective
"The fund goal was $20 million in equity to buy $80 million in property," he said. "We're over $10 million of raised capital, and we've deployed $40 million of assets."
This means more acquisitions are on the way, he said.
Investors have flocked to the industrial real estate market during the COVID-19 pandemic, which has made investing in the office and retail sectors less desirable. The market has also seen intense demand from industrial users.
Luther said there is indeed strong appetite for this product type.
"And because there's a lot of interest in it from developers, or owners, or REITS, you name it, that means there's more competition, there's more pricing increases happening," Luther said. "So that means you have to find differentiators in order to produce yield for your investors."
What Luther Group does, he said, is leverage relationships and find off-market opportunities. The New Berlin acquisitions are examples of that, Luther said.
"(That) allows us to have a little bit more yield for investors," he said.
