Managing Director jim.freeman@jll.com (404) 995-2399
Debt
Matt Casey
Managing Director
matt.casey@jll.com (404) 942-2221
Dennis Mitchell
Senior Managing Director
dennis.mitchell@jll.com (404) 995-2447
Britton Burdette
Senior Manging Director britton.burdette@jll.com (404) 995-2302
Maggie Dominguez Managing Director maggie.dominguez@jll.com (678) 378-4593
Bobby Norwood Managing Director
bobby.norwood@jll.com (404) 460-1652
Leasing
Christopher Gaw
Vice President
christopher.gaw@jll.com (615) 928.5268
Anthony Sansone Director
anthony.sansone@jll.com (615) 928-5248
Deal support
Hannah L. Pennington Associate hannah.pennington@jll.com (470) 367-6370
JLL Industrial
Georgia
Dennis Mitchell
Britton Burdette
Jim Freeman
Maggie Dominguez
Bobby Norwood
Pete Pittroff Dave
Michael
Jake Eckstein Analyst
jake.eckstein@jll.com (404) 495-8727
Paige Marlow Vice President paige.marlow@jll.com (404) 942-2211
John
THE OFFERING
Jones Lang LaSalle America, Inc. (“JLL”) has been exclusively retained by ownership as the sales representative for Chattanooga Industrial One, also known as the “Property” – a Class A state-of-the-art production and distribution facility totaling 301,525 square feet located within Chattanooga’s Enterprise South Industrial Park.
100% leased to Sesé Industrial with 12.2 years of term remaining, this impeccably designed build-to-suit facility is a crucial extension of Volkswagen’s expansive 3.4 million square foot, 1,400-acre production plant located 3.7 miles away. The lease is guaranteed by Sesé Industrial's international parent company, Grupo Sesé (€ 1B+ Rev. 2023 & 2024), who operates in 20 countries around the world with 14,700+ total employees. Sesé’s operation at the Property includes meticulously assembling and supplying front and rear axle components for Volkswagen’s popular ID.4 and Atlas SUVs. Operating with unparalleled efficiency, these assemblies are delivered to VW around the clock up to 24 hours a day, 7 days a week – in a synchronized, just-in-time flow that underscores the mission-critical nature of this operation. The facility dispatches assembled units at four-minute intervals, meeting Volkswagen’s rigorous demands. This offering presents a unique opportunity to acquire Grupo Sesé’s North American Headquarters – an irreplaceable and strategically vital production facility within the Volkswagen ecosystem.
Offering extensive transportation infrastructure, Chattanooga boasts exceptional connectivity as the crossroads of three major thoroughfares: I-75, I-24, and U.S. 64, providing superior access to Atlanta, Nashville, Birmingham, Knoxville, and the greater Midwest. Chattanooga’s major industries include automotive and advanced manufacturing, and it is home to Volkswagen’s only U.S. assembly plant which is just minutes from the Property. With 1 in 5 jobs being manufacturing related, the city has a skilled industrial labor force. Recognized as “Gig City” for its pioneering gigabit-speed internet infrastructure and its emergence as a quantum technology hub, Chattanooga is at the forefront of technological innovation. This blend of strategic location, a robust automotive manufacturing industry, and technological advancement positions Chattanooga as an ideal location for industrial investment.
Address 6153 Claude Ramsey Pky Chattanooga, TN 37416
RBA
301,525 SF
Year Built 2021
Tenant Sesé Industrial
Tenant Guarantor Grupo Sesé (€1B+ Rev. 2023 & 2024)
Remaining Lease Term 12.2 Years
Average Annual Escalations 2.5% until 12/1/31 then 2.75% to LXD
Reimbursements NNN
Year 1 NOI
$2,382,040 ($7.90 PSF)
INVESTMENT HIGHLIGHTS
STATE-OF-THE-ART CONSTRUCTION
• Pre-cast concrete panel construction
• Rear-load configuration
» 16 dock-high doors
- Expandable to add 50 more, insulated, fully equipped with 40k lb. mechanical levelers, seals and lights
» 2 drive-in doors, expandable to add 2 more
• 32’ – 35’ clear heights
• 130’ truck court (60’ concrete apron)
• 45-mil TPO roof with 13 years of warranty remaining (exp. 5/27/36)
» R-28.8 insulation, external gutters and downspouts
• 261’ x 1154’ building depth
» 50’ x 48’ column spacing (60’ speed bays)
• 10,000 SF of office
• ESFR sprinkler system
• LED lights
• 390 auto spaces
• Multiple points of ingress/egress with full site circulation
• Project secured with fence, gates and guardhouse
• Ability to convert to multi-tenant
• Located in Enterprise South Industrial Park
FINANCIAL HIGHLIGHTS
• 100% leased to Sesé Industrial with 12.2 years of term remaining
» 2.50% annual rent escalations, increasing to 2.75% on 12/1/31
» In-place rent is $7.74 (6.2% below market)
» Net recovery structure with limited landlord responsibility
• Grupo Sesé (Guarantor)
» A Tier 1 automotive supplier with multi-generational corporate relationships
- Grupo Sesé has a strategic relationship with Volkswagen across its global manufacturing network
- 60+ years of experience in the automotive manufacturing sector
- Clients include industry leaders such as Volkswagen, Ford, GM, and Mercedes-Benz
» Parent company – Grupo Sesé
- A multi-generational, privately held global logistics conglomerate based in Spain
- 14,700+ employees operating in 20 countries across Europe, North America, Asia and Africa
- Exceeded € 1B top-line revenue in 2023 and 2024
STRATEGIC, MISSION-CRITICAL LOCATION
• Mission-critical extension of the Volkswagen’s 3.4M SF production plant
» Volkswagen’s plant is located just 1.5 miles away
» The Property supports two marquee vehicles in Volkswagen’s North American lineup: the Atlas and the ID.4
» Sesé's lease term represents two full production cycles of VW's Atlas and ID.4 assemblies
» Operates up to 24/7 to meet Volkswagen’s assembly demands
» Assembled front and rear axles and central modules depart the Facility every four minutes
• Grupo Sesé’s only North American facility
» 19th production plant with Volkswagen globally
• Sesé has invested over $80M into the building with the installation of a custom, automated assembly line, underscoring their long-term commitment to the facility
• Continuous operations delivering assembled vehicle components at four-minute intervals, establishing the facility as essential infrastructure in Volkswagen’s manufacturing ecosystem
• Strategic 50-year, board-level partnership with Volkswagen Group and diverse client portfolio including premier automotive manufacturers (Ford, GM, Mercedes-Benz) and global consumer brands (Coca-Cola, Adidas)
• Sophisticated Chattanooga facility supporting Volkswagen’s electric vehicle and internal combustion engine production initiatives with precision component integration processes
INVESTMENT HIGHLIGHTS -
Historically Tight Industrial Market with Limited New Supply
• The Chattanooga market includes 6 counties spanning from North Georgia to Southeastern Tennessee and comprises nearly 110 MSF of industrial inventory
» Bradley, Hamilton, & McMinn counties in TN
» Catoosa, Walker, & Whitfield counties in GA
• Vacancy has remained below 5% since 2017 and currently sits at 2.9%
» Outlying Chattanooga Submarket 5-year average vacancy rate of 1.3%
• On average, 302,245 SF of product has been delivered annually over the past 5 years representing less than 0.5% of current market inventory
» High barriers to entry including rocky soil and challenging topography limit industrial development in all directions
• Asking rents across the market have exploded over the past 5 years demonstrated by a 7.9% CAGR
» Forecasted rent growth over the next 5 years remains strong at a ~5% CAGR and is supported by growing demand requirements combined with natural supply constraints
Chattanooga – The Gateway to the Southeast
• Crossroads of three major thoroughfares, including I-24, I-75, & I-59
• Rated as a 5-star logistics hub by Expansion Management & Transportation magazine
• Home to Volkswagen’s only U.S. Plant – 1,400 acres w/ total investment over $3.5 billion
» Employs 5,000+ people, producing 234,000 vehicles per year
• Air, Water, & Rail
» Chattanooga Metropolitan Airport served by FedEx for air cargo services
» Administered by the Tennessee Valley Authority (TVA), the Tennessee River carries barge lines along 16,000 miles of navigable waterways
» Major freight hub with the presence of Norfolk Southern and CSX Class I freight rail service
» Appalachian Regional Port in Murray County opened in 2018 and has seen explosive growth
> Current throughput of 75,000 containers is ahead of their 2022 projection of 20,000 per year
> Volkswagen is one the ARP’s largest customers
• Chattanooga, known as “Gig City”, was the first U.S. city to provide gigabit-speed internet to residential and commercial sectors
» Turning Chattanooga into a hot spot for tech companies and startups
» Education Enrollment
» University of Tennessee Chattanooga: 10,781
» Chattanooga State Community College: 5,058
» Southern Adventist University: 2,303
• Affordable living – Chattanooga’s cost of living is 9% below the national average
• Named “Best Place to Live in Tennessee” by U.S. News & World Report in 2024
• Major industries include automotive, advanced manufacturing, food and beverage, and healthcare
Chattanooga Industrial One || 7
VOLKSWAGEN - CHATTANOOGA
• In July of 2008, Volkswagen announced that it has selected Chattanooga for its $8 billion, 1,400-acre plant campus
• An additional $800 million was invested in 2019 to expand the plant's capacity for electric vehicle manufacturing
• Today, Volkswagen plant produces about 51 vehicles an hour, and has expanded production to roughly 234,000 vehicles per year, up from 174,000 in 2023
• From the start, the plant quickly became one of the city's largest employers, totaling roughly 5,000 employees as of the start of 2024
• The company is experiencing robust and sustained growth momentum, with workforce expansion exceeding 500 additional personnel during the current fiscal year
• Volkswagen's continued investment in Chattanooga solidifies its commitment to the region and further enhances its status as a hub for automotive manufacturing and innovation
TENANT OVERVIEW
TENANCY Ses é Industrial
GUARANTOR Grupo Ses é
GRUPO SES É (GUARANTOR)
60 YEARS OF OPERATION
20 COUNTRIES
14,700+ EMPLOYEES
32.3 MSF WAREHOUSING
LXD 11/30/2037 ANNUAL ESCALATIONS
2.50% until 12/1/31, 2.75% thereafter
LEASE TERM 12.2 years
2023 & 2024 REVENUE SURPASSED €1B 5.7M ASSEMBLIES / YEAR
With a legacy spanning six decades in the automotive manufacturing sector, Grupo Sesé has established itself as a pivotal partner in the OEM and Tier 1 supply chain ecosystem. The company delivers comprehensive services encompassing upstream supplier management, sophisticated just-in-time/ just-in-sequence assembly operations, warehousing logistics, components distribution, and finished vehicle logistics solutions. Grupo Sesé’s integrated service portfolio constitutes an essential foundation for maintaining production continuity and schedule adherence across multiple global automotive manufacturing platforms. The company’s distinguished client portfolio includes industry leaders such as Ford, General Motors, Mercedes-Benz, Volkswagen Group, Michelin, Cooper Standard, Lear Corporation, Valeo, and extends beyond automotive to include global consumer brands like Coca-Cola and Adidas.
At the Chattanooga facility, Gruop Sesé executes sophisticated component integration processes, receiving critical electric vehicle components—including central computational modules, axle assemblies, braking systems, rotors, propulsion units, and suspension components. These components undergo precision assembly and strategic staging to facilitate immediate integration with chassis units on the production line. The completed assemblies are then transported to Volkswagen’s manufacturing complex located approximately one mile from the facility on a meticulously coordinated just-in-time schedule. Operating continuously throughout the week, the facility dispatches fully assembled front and rear axle units and central modules at four-minute intervals to meet Volkswagen’s rigorous production requirements, underscoring the facility’s designation as truly mission-critical infrastructure within Volkswagen’s manufacturing ecosystem.
VOLKSWAGEN STRATEGIC PARTNERSHIP
Grupo Sesé maintains a multifaceted, strategic relationship with Volkswagen across its global manufacturing network. Until recently, Volkswagen’s Chattanooga facility—commissioned in 2011—represented the sole significant final assembly operation within the automaker’s global production infrastructure where Grupo Sesé did not maintain substantive operational involvement. This paradigm shifted with Volkswagen’s inaugural electric vehicle production initiative, which commenced operations in late 2021. The current operational framework and assembly/ distribution architecture in Chattanooga has been strategically modeled after Grupo Sesé’s established production methodology previously implemented at Volkswagen’s German manufacturing facilities.
MISSION CRITICAL PARTNERSHIP
Atlas (combustion-powered) and the MEB-platform ID.4 (electric), both assembled at VW’s nearby Chattanooga plant. The facility may accommodate future vehicles using these drivetrain architectures. At Chattanooga Industrial One, Gruop Sesé manages the precision assembly of axle components (EV modules, axles, brakes, engines, suspension systems) into complete units ready for immediate chassis integration, delivering them to the VW plant on a just-in-time basis. Operating 24/7, completed assemblies depart every four minutes— establishing this as mission-critical infrastructure.
Following the integration of Atlas production, manufacturing cycle times underwent a strategic compression from 168 minutes to 128 minutes, responding to heightened market demand and optimizing operational throughput.
The tenant's $80M investment is strategically allocated across advanced manufacturing systems and robotics ($40M), operational ramp-up costs ($20M), enterprise IT infrastructure and servers ($10M), material handling fleet ($5M), power systems ($2M), and facility enhancements and security ($3M). Every 56 seconds, VW electronically transmits specific build requirements to Gruop Sesé. Based on model specifications and variants, 165 individual components are assembled into approximately 250 different configurations before undergoing quality testing. This process runs continuously across up to three shifts, seven days weekly.
A complete ID.4 assembly includes front/rear axles, central computer module, electric motor(s), gearbox(es), inverter(s), and full suspension and braking systems—all assembled onto custom frames designed for direct attachment to VW’s production line.
128 Minutes
VW transmits specific build requirements every 56 seconds
165 components are assembled into 250 configurations
Every 4 minutes 4 assemblies depart from Chattanooga Industrial One to VW
This process runs continuously up to 3 shifts, 24/7
ENTRENCHED OPERATION
Grupo Sesé-VW Relationship
• Grupo Sesé is a key supplier to 18 other VW plants globally, with Chattanooga being the 19th co-location
» VW executed a board-level directive requesting Sesé to establish strategic operations proximate to their Chattanooga manufacturing campus
• 50-year global relationship between Grupo Sesé and VW demonstrates long-term stability
• Grupo Sesé is committed to supporting the Chattanooga plant for the next 30+ years
◊ Sesé recently executed a lease extension, further demonstrating their long-term commitment to the facility
◊ Sesé is strategically leveraging this foundation to diversify its U.S. locations and customer base across the American automotive sector
• Willing to accept economic loses on current contract to secure long-term partnership
• VW representatives maintain close relationship with daily management visits to the Grupo Sesé facility
Facility Investment & Commitment
• Grupo Sesé’s total investment reaching $80M after Atlas line integration
» $40M - Advanced manufacturing systems & robotics
» $10M - Enterprise IT infrastructure & servers
» $20M - Operational ramp-up costs
» $5M - Material handling fleet
» $2M - Power systems
» $3M - Facility enhancements & security
• Sesé upsized the original 265k sf building footprint at VW’s direct request to support additional business
Trade Cycle Security
• OEMs typically retain suppliers for 2-3 model production runs (each lasting 7-10 years)
• Now supports multiple VW product lines: both ID.4 (EV) and Atlas (ICE) models
» Dual model support provides stability during automotive industry’s EV transition period
» Production has doubled from original plans
PROPERTY SPECS
Address 6153 Claude Ramsey Parkway, Chattanooga, TN
Built 2021 Clear Height 32' - 35'
Construction Type 8" insulated precast concrete panels
Configuration Rear-load
Roof 45-mil TPO membrane (warranty exp. 05/2036)
Dock-High Doors 16
Drive-In Doors 2 12’ x 14’ doors, insulated and powered
Dock Equipment 40,000 lb mechanical pit levelers, seal and lights
Building Dimensions 261’-4’’ x 1154’
Truck Court Depth 130' (60' concrete apron)
Parking 390
Column Spacing 50' x 48' (60' speed bays)
Slab 7’’ thick, with 8’’ in certain production areas
Electrical 2,500 Amp, 480/277 volt
Fire Prevention ESFR
Lighting LED
SURROUNDING TENANCY
Chattanooga IndustrialOnÉ
KEY DISTANCES
ACCESS TO CONSUMERS AND LABOR
Sesé Industrial (Guarantor: Grupo Sesé) 301,525 SF 11/30/37 LXD
20 MARKET OVERVIEW
REGIONAL CONNECTIVITY WITH STRONG GROWTH
KNOXVILLE
CHATTANOOGA
15.5 MILLION CONSUMERS
within 3 hour drive of Chattanooga encompassing the cities shown
NEARBY NOTABLE USERS
CHATTANOOGA MARKET ANALYSIS
The Chattanooga industrial market defined by CoStar includes six total counties and roughly 63 MSF of product, but in JLL’s opinion, the industrial market is quite different, surpassing 117 MSF in total and encompassing the CSA of Dalton, Georgia and Cleveland, Tennessee. As a result, it is a bookend of the I-75 corridor that connects Atlanta to Chattanooga, defining one of the highest truck traffic counts in the country due to its ability to provide rapid access throughout the greater Southeast and Midwest regions. Chattanooga is strategically positioned at the junction of three major interstates: I-24, I-75, & I-59, providing impeccable access to Atlanta, Nashville, Birmingham, Knoxville and the greater Midwest. The city is a vital hub for automotive manufacturing, serving as the home for Volkswagen’s 1,400-acre assembly plant which employs roughly 5,500 employees. More than 1 in 5 jobs are manufacturing related in Chattanooga, highlighting the significance of the industry to the city and the availability of industrial labor to the surrounding area.
• The Appalachian Regional Port (ARP) opened in August 2018 and has seen explosive growth. Current throughput sits at 75,000 containers, which is already ahead of their 2022 projection of 20,000 per year
• ARP sits on 42 acres in Northwest Georgia’s Murray County and provides a powerful new gateway of import goods to the Sunbelt and Midwest, along with export goods to all global markets. This will continue to drive tenant requirements to the Atlanta Northwest Submarket as the port grows
• The port has a capacity of 75,000 containers per year, and a 10-year development plan will increase that capacity to 100,000 containers per year
• ARP provides an efficient alternative to an all-truck dray to/from the Port of Savannah for target markets in Georgia, Alabama, Tennessee, Kentucky and beyond
• The inland port offers exclusive CSX service on a direct, 388-mile rail route to/from the Port of Savannah’s Garden City Terminal
• Each round-trip container moved via the ARP will offset 710 truck miles on Georgia highways
• With easy access to Interstate 75 and U.S. 411, both Birmingham and Nashville are within a 3-hour drive, and Downtown Atlanta can be reached in under 2 hours
• Sitting 45 minutes from Chattanooga, there is a rich pipeline of flooring/carpeting business in the area with Shaw, Mohawk, and Engineered Floors based in Dalton and The Altus Group based in Chatsworth
75,000
CONTAINER CAPACITY PER YEAR
PORT VOLUME
6,000 ft
EXCLUSIVE ACCESS
75% OF WORKING TRACKS
710
TRUCK MILES OFFSET PER CONTAINER
2,365 TEUs
STORAGE CAPACITY
ATLANTA
CHATTANOOGA
APPALACHIAN REGIONAL PORT
THE GATEWAY TO THE SOUTHEAST
Chattanooga’s strategic positioning, known as the “Gateway to The Southeast”, provides vital access to the crossroads of major interstates including I-24, I-75, and I-95. This region markets itself as a premier destination for business growth, offering an exceptional economic environment where both new and established businesses thrive. This supportive environment is coupled by superior logistics connectivity to major markets like Nashville and Atlanta, positioning it as a premier hub for business growth and expansion. Furthermore, while located on the Tennessee River, where barge lines transport goods along 16,000 miles of navigable waterways administered by the Tennessee Valley Authority (TVA), Chattanooga experiences a large volume of commercial activity, serving as a vital hub for regional trade and transportation. Chattanooga continues to prove its economic foundation as it is bursting with natural affluence, a potent tourist appeal, a professionally cultivated workforce, and a centralized location. Based on Chattanooga’s superior service to manufacturing, pioneering fiber optics system, solid infrastructure for ground transport, and support for air, water, and rail transport, this rapidly-growing city has deemed itself a premier logistics hub.
High truck traffic counts for rapid access throughout the Southeast and Midwest.
Manufacturing is a significant industry, with over 1 in 5 jobs related to it.
Rated as a 5-star logistics hub by Expansion Management and Transportation and
“BUCKLE OF THE BATTERY BELT”
Chattanooga is quickly becoming the epicenter for one of the nation’s fastest growing industries as automakers invest billions in electric vehicle production across the Southeast. Known as the ‘Buckle of the Battery Belt’, Chattanooga stands out as a premier city for these strategic investments due to its prime location, robust infrastructure, affordable living costs, diverse transportation network, skilled workforce, and strong support from the Tennessee Valley Authority.
PIEDMONT LITHIUM
• $582 million plant with estimated production capacity of 30,000 metric tons of lithium hydroxide per year
• Plant will create about 120 jobs
• Doubles current American production capacity of 20,000 metric tons per year
• Piedmont Lithium signed deal with Tesla to supply battery materials through 2025
• Option to extend for 3 more years
• Chattanooga has favorable location, infrastructure, cost of living, transportation, and labor for electric vehicle industry
• Chattanooga's high-speed internet and transportation networks, along with manufacturing roots, position it as a key player in the industry
NOVONIX
• Announced a $1 billion expansion on 182 acres in Chattanooga’s Enterprise South Industrial Park, set to create 500 new jobs, significantly boosting the local economy and industrial sector
• Novonix operates a $160 million, 400,000 square foot factory in Chattanooga that manufactures synthetic graphite anode materials for lithium-ion batteries
• Novonix has a partnership with one of the largest battery manufacturers, LG Energy Solutions, to develop artificial graphite materials at the Chattanooga facility
• Novonix provides advanced materials and services for the global lithium-ion battery industry
• Novonix plans to increase production capacity at the Riverside facility to meet industry demand, aiming for 10,000 tons per annum by 2025, and 150,000 tons per annum by 2030.
“As demand for lithium hydroxide continues to soar in the U.S., this conversion facility will be key in the domestic effort to reduce reliance on foreign nations for lithium processing.
Keith Phillips, Piedmont Lithium’s president and chief executive officer
GIG CITY & INDUSTRY INFORMATION
• Chattanooga, known as the “Gig City,” was the first U.S city to provide gigabit-speed internet to both its residential and commercial sectors.
» Chattanooga is emerging as a quantum technology hub, spearheaded by initiatives like “Gig City Goes Quantum” and the Chattanooga Quantum Collaborative (CQC), leveraging the city’s exceptional fiber optic infrastructure to develop a thriving quantum ecosystem
» The University of Tennessee at Chattanooga (UTC) is leading quantum research and education efforts, offering quantum information science programs and partnering with Oak Ridge National Laboratory, while EPB’s Quantum Network provides public access to quantum-as-a-service connectivity
• The city now offers 25 gigabit-per-second service to all residents and businesses.
» The Fiber Optic network allows upload and download speeds 200 times faster than the current national average
• EPB is the community-owned electric utility company that run’s one of America’s first “smart grid”
» EPB estimates its smart grid has cut power outages by 55% by quick detection and seamless rerouting of power
• Tech-oriented businesses have flocked to Chattanooga because of the favorable business environment, superior connectivity and access to a wide variety of leisure activities
» Text Request and Freight Waves are two start-ups that made Deloitte’s 2023 Top 500 Fastest Growing Tech companies
Notable employers in Chattanooga
• Blue Cross Blue Shield of Tennessee employed 6,607 full time employees and provides health care financing to the region
• Tennessee Valley Authority employs over 3,900 people throughout Chattanooga by providing electricity to 10 million people within the Tennessee Valley region
• Roper Corporation—a subsidiary of GE Appliances—is planning a $118 million expansion to its Walker County plant.
• McKee Foods is known for their Little Debbie brand of snack cakes and is headquartered just outside of Chattanooga in Collegedale, Tennessee
• Multiple universities, colleges, and technical colleges provide a robust skilled work force
» University of Tennessee Chattanooga: 10,781 students
» Chattanooga State Community College: 5,058 students
» Southern Adventist University: 2,303 students
• Highest concentration of skilled labor within the region
» 19% of population within 20 miles of Downtown possess a Bachelor’s degree
FINANCIAL ASSUMPTIONS
LEASING ASSUMPTIONS
VALUATION NOTES
• TN Franchise/Excise Taxes are not reflected in the Cash flow. Prospective buyers should rely on their own research for what implications TN Franchise/Excise taxes may have on their investment.
CASH FLOW
• TN Franchise/Excise Taxes are not reflected in the Cash flow. Prospective buyers should rely on their own research for what implications TN Franchise/Excise taxes may have on their investment
EXISTING RENT AND ROLLOVER SCHEDULE
LEASE ABSTRACT
Tenant: Sesé Industrial
Guarantor : Grupo Sesé Grupo
Lease Commencement: 11/5/2020
Lease Expiration: 11/30/2037 (per Second Amendment)
Leased Square Feet: 301,525
Lease Structure: NNN
ORIGINAL LEASE ABSTRACT
SECURITY DEPOSIT
$174,633.22, which may be provided as cash or irrevocable standby letter of credit
BASE RENT
Initially set at $6.95 per square foot, with 2.0% annual escalations
OPERATING EXPENSES
Tenant shall pay all reasonable costs paid and incurred by Landlord in connection with the operation, servicing, maintenance, repair and replacement of those portions of the Premises in which Landlord has the obligation to operate, service, maintain, repair and replace.
TENANT RESPONSIBILITIES
Tenant shall maintain and keep in substantially the same condition as existed on the Lease Commencement Date the interior of the Building and appurtenances including interior surfaces of exterior walls, doors, door frames, windows, plate glass, plumbing and sewage facilities, ventilation, heating and air conditioning, electrical systems, sprinkler systems, interior wall surfaces, floor slabs and ceilings.
LANDLORD RESPONSIBILITIES
Landlord is responsible for major repair costs or capital replacements associated with: (1) Structural Building Components (roof, roof systems, gutters, downspouts, Building footers, foundation, structural floor slab, structural or load-bearing columns and walls); (2) exterior surfaces of exterior walls; (3) Exterior Utility Lines; and (4) Paved Area Replacement.
TENANT IMPROVEMENT ALLOWANCE
Landlord agreed to pay up to Six and 50/100 Dollars ($6.50) per leasable square footage of the Building toward the cost of Tenant’s Work. All costs exceeding this allowance shall be borne by Tenant.
EARLY TERMINATION RIGHT*
Tenant has a one-time right to terminate the Lease effective as of August 31, 2029. To exercise this right, Tenant must satisfy these conditions: (1) no Event of Default exists; (2) Tenant must provide written notice to Landlord at least twelve (12) full months prior to the Early Termination Date; and (3) Tenant must pay Landlord on or prior to the Early Termination Date a termination fee equal to the total sum of Base Rent that would have been charged from the day after the Early Termination Date through the end of the scheduled Lease Term, calculated on a monthly basis with a present value discount factor of ten percent (10%). The lease specifies that this payment is considered liquidated and agreed damages, not a penalty.
RENEWAL OPTIONS
Tenant has one (1) option to renew the Lease Term for five (5) years. The renewal option must be exercised by Tenant giving Landlord irrevocable written notice not later than twelve (12) months prior to the expiration of the then-current Lease Term. During the Renewal Term, the Base Rent shall be adjusted to equal 100% of the Fair Market Rent, but never less than 100% of the Base Rent payable in the Lease Year prior to the Renewal Term, with continued 2% annual escalations.
*Please note: If Tenant were to exercise their early termination right on August 31, 2029, they would be required to pay the landlord approximately $16 million as a termination payment. This amount represents the present value (calculated using a 10% discount factor) of all remaining Base Rent through the end of the scheduled Lease Term. Additionally, the Tenant would remain responsible for Operating Expenses through the remainder of the Lease Term even after early termination, providing additional financial protection.
LEASE ABSTRACT - CONT
FIRST AMENDMENT TO LEASE AGREEMENT (JUNE 30, 2022)
ADDITIONAL PARKING FACILITIES
Landlord agreed to construct an additional ninety-nine (99) parking spaces on the Premises (the “Additional Parking Facilities”), to be constructed materially and substantially in accordance with the plans and specifications attached as Exhibit A to the First Amendment.
DELIVERY TIMELINE
Landlord committed to “use all commercially reasonable efforts to deliver the Additional Parking Facilities Substantially Complete on or before August 31, 2022 (the ‘Anticipated Delivery Date’), assuming the absence of any event of Force Majeure
BASE RENT ADJUSTMENT
Effective August 1, 2022, the initial Base Rent was modified to be calculated utilizing “Seven and 25/100 Dollars ($7.25) per square foot of leasable square feet of space within the Premises.”
UPDATED RENT SCHEDULE
The amendment included a completely revised rent matrix showing monthly and annual rent amounts for each year through Lease Year 13, with rates escalating from $7.25/sf to $9.20/sf by the end of Lease Year 13.
SECOND AMENDMENT TO LEASE AGREEMENT (SEPTEMBER 25, 2024)
LEASE TERM EXTENSION
The initial Lease Term shall be extended by an additional three (3) years, totaling sixteen (16) Lease Years and four (4) months.
INITIAL TERM CONTINUATION
As of the Effective Date of this Second Amendment and continuing through November 30, 2024, Tenant shall continue to pay Base Rent in accordance with the Base Rent Matrix set forth under the First Amendment, for Lease Year 3 ($7.55 per square foot).
UPDATED RENT SCHEDULE
Commencing December 1, 2024 (Lease Year 4), a new rent matrix was established for the remainder of the Initial Term, with rates increasing from $7.74/sf in Lease Year 4 to $10.54/sf in Lease Year 16, with the Initial Lease Term now expiring on November 30, 2037.
Primary
Jim Freeman
Managing Director jim.freeman@jll.com (404) 995-2399
Dennis
Senior
dennis.mitchell@jll.com (404) 995-2447
britton.burdette@jll.com (404) 995-2302
Debt & structured finance
Matt Casey
Managing Director matt.casey@jll.com (404) 942-2221
Bobby Norwood
Managing Director bobby.norwood@jll.com (404) 460-1652
