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KKR securitizes $543M logistics property portfolio

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KKR is tapping the commercial mortgage securities market to finance a new loan secured by a portfolio of 71 industrial “last-mile” logistics properties owned by the investment firm in seven states.

The $543 million KKR Industrial Portfolio Trust 2020-AIP is backed by a two-year, $571.6 million loan (with three one-year extensions) with a coupon of 1.84% plus one-month Libor.

The interest-only loan was underwritten by Goldman Sachs and JPMorgan, according to a presale report from Moody’s Investors Service.

The transaction’s senior notes include a $253.74 million Class A tranche with a preliminary Aaa rating from Moody’s.

The loan is collateralized by the fee simple and leasehold interest in properties that are located primarily in in urban markets with access to cargo transportation hubs and large population centers. Nearly 70% of the properties (by allocated loan amount) are located in “global gateway” markets like Atlanta, Baltimore, Chicago, Los Angeles (Inland Empire and Orange County), Dallas/Fort Worth and Houston.

The portfolio has a granular tenant roster of over 256 tenant leases, according to Moody’s, with the largest tenant being Amazon PillPack in Phoenix.

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CMBS Logistics industry