Plymouth Industrial REIT Announces Strategic Partnership with Sixth Street

Core Insights - Plymouth Industrial REIT has entered a strategic partnership with Sixth Street, securing approximately $500 million in capital for acquisitions and growth [1][2] - The investment includes $250 million from Sixth Street, structured as a 65% joint venture ownership of Plymouth's Chicago portfolio and a non-convertible preferred equity investment [1][3] - Plymouth's Chicago portfolio, valued at approximately $356 million, will be contributed to the joint venture at a 6.2% capitalization rate, retaining 35% ownership of the 5.9 million-square-foot portfolio [1][3] - The transaction is leverage-neutral, with expectations of a sequential decline in overall leverage in Q4 2024, aligning with Plymouth's leverage targets for 2024 [1][2] Investment Details - The Sixth Street investment consists of two main components: $116 million for the joint venture and $140 million in non-convertible preferred equity [3][4] - The Chicago portfolio will generate approximately $294 million in gross proceeds, resulting in about $212 million of deployable proceeds after accounting for mortgage assumptions and transaction costs [3][4] - Preferred equity has a 7.0% annual return, with a cash pay portion of 4.0% and a 3.0% PIK component, and can be redeemed after the initial closing [4] Company Background - Plymouth Industrial REIT is a full-service, vertically integrated real estate investment company focused on industrial properties [5] - Sixth Street is a global investment firm with over $75 billion in assets under management, specializing in flexible capital solutions for companies [6]