Four Under-Contract Otay Mesa Buildings are Tip of the Iceberg for EastGroup

EastGroup Properties Inc. is under contract to purchase four multi-tenant business distribution buildings totaling 547,000 square feet for $135 million in the Otay Mesa submarket of San Diego. The buildings, known as Siempre Viva Distribution Center III, are 66 percent leased and located adjacent to the company’s Siempre Viva Distribution Center I and II properties, which are 100 percent leased. The acquisition is expected to close in late November.

In addition, earlier this month, EastGroup began construction of LakePort 4 and 5 in the Flower Mound submarket of Dallas which will contain 177,000 square feet and have a projected total cost of $22 million. These buildings will adjoin the company’s LakePort 1-3 properties, which are 100 percent leased.

The company executed a lease with a customer that will fully occupy World Houston 47 in Houston upon completion. The construction of this property, which will contain 139,000 square feet and has a projected total cost of $19 million, is expected to commence in first quarter 2022.

Also, the company is under contract to sell Jetport Commerce Park in Tampa for $45 million.

“We began the year with a 42-acre development site in south San Diego. We thankfully found a user and are under construction for a 100 percent pre-leased development,” says Marshall Loeb, EastGroup CEO. “We then began searching for a new land site or existing vacancy opportunity. We are pleased that we are under contract to purchase these four adjacent buildings and that we were able to raise the percent leased from 53 percent to 66 percent prior to closing. I’m also excited to add to our prospective 2022 development starts a 100 percent pre-leased project within our World Houston Business Park.”

As of November 5, 2021, EastGroup’s portfolio was 98.5 percent leased and 97.6 percent occupied.