iStar REIT buys Plant City warehouse

A New York-based investment firm has acquired a distribution center occupied by the nation’s largest grocery distributor in Plant City for $70 million, property records indicate.

iStar Financial Inc. affiliate CS NLA II LLC bought the property, at 1802 Jim Johnson Road, from C&S Wholesale Grocers Inc., a New Hampshire-based grocer that supplies Winn-Dixie and other chains.

The 836,771-square-foot building, on more than 130 acres, was completed in 1991. Prior to the Winn-Dixie and C&S affiliation, the building has served as a Sweetbay Supermarkets distribution hub.

The building features 30-foot-clear ceiling heights, has 120 dock loading doors and more than 200,000 square feet of cold storage capacity. The property also has more than 330 parking spaces attached to it.

Neither iStar Financial nor C&S Wholesale officials returned telephone calls or emails regarding the transaction.

It is expected that C&S Wholesale will continue to occupy the property through a sale-leaseback with iStar Financial. The investment firm has completed more than $4 billion in so-called “net lease” deals in recent years, according to its website. Net lease transactions are considered valuable because they typically involve credit-worthy tenants that provide steady cash flow and yields for investors.

The iStar Financial deal comes as numerous investors and tenants are focusing on industrial space in the Interstate 4 corridor in Plant City, a more western alternative to traditional distribution hubs in Lakeland and elsewhere in Polk County.

Last month, for instance, Nestle Waters N.A. signed a roughly 283,000-square-foot lease with Nuveen Real Estate for space in its County Line Distribution Center, also in Plant City. Nuveen is a real estate affiliate of investment giant Teachers Insurance & Annuity Association.

The lease with Nestle brings the 3602 Fancy Farms Road building to full occupancy. The balance of the 402,200-square-foot property, completed last December, is occupied by Hardware Resources.

Commercial real estate brokerage JLL represented Nuveen in the transaction, while Colliers International Tampa Bay negotiated on behalf of Nestle. Distributors like Nestle and C&S Wholesale favor the Interstate 4 corridor as a site for distribution because they can reach as many as 20 million consumers within a single day.