Overview
Institutional Property Advisors (IPA), a division of Marcus and Millichap, is pleased to offer the opportunity to acquire a +/- 170,192 SF single tenant steel manufacturing industrial facility (“Asset” or “Property”) leased to Joseph T. Ryerson & Son, Inc. (“Tenant” or “Ryerson”) in Houston, TX. The absolute NNN lease is guaranteed by Ryerson Holding Corporation, the public parent company. Ryerson is one of North America’s largest metal distributors, with over $4.6 billion in annual revenue and $112 million EBITDA or $167 million Adjusted EBITDA.
This single-tenant absolute NNN leased manufacturing facility provides ownership with secure cash flow from a strong tenant utilizing the site as a mission critical income producing facility. Additionally, this large and well-located site, with significant existing infrastructure and a below market rent, provides future ownership with long-term appreciation potential due to its infill location, infrastructure, and the underlying value of real estate.
Investment Highlights
HIGHLY ATTRACTIVE LEASE TERMS
• Absolute NNN lease structure with no landlord responsibilities
• Below market rental rate of $7.13 / SF NNN for the benefit of the Tenant and long-term advantage for the future Landlord
• Asking rents are just below $9.00 / SF in the submarket for generic warehouse space and increase substantially in other areas of the Houston MSA or for simliar buildings with heavy crane buildout
STRONG CORPORATE TENANT
• 100% leased to Joseph T. Ryerson & Son, Inc. with Ryerson Holding Corporation as the guarantor
• Ryerson carries strong credit ratings of BB from Fitch and BB from S&P
• Ryerson is publicly traded on the NYSE (RYI) with a market cap of ~ $674M
EXTREMELY VALUABLE & HEAVY INFRASTRUCTURE
• This +/- 170,192 SF Asset serves as a key advanced manufacturing site, featuring heavy buildouts, 25'-30' clear heights, and 6 drive-in doors to support sophisticated operations
• Very key infrastructure includes seven (7) 20-ton cranes, one (1) 15-ton crane, a heavy floor load capacity to support the cranes and heavy materials, a rail track, and an X-Ray machine
• Landlord provided Tenant with two (2) 20-ton cranes and a rail line in 2021 , further underscoring the strategic importance and heavy utilization of the Asset
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