Americold Realty Trust, a publicly traded REIT focused on the ownership, operation and development of temperature-controlled warehouses, has entered into a definitive agreement to acquire privately held Chiller Holdco from Cloverleaf management and an investor group led by private equity funds managed by Blackstone Group for $1.24 billion.
The closing of the acquisition is subject to customary closing conditions and is expected to occur in the second quarter of 2019.
Founded in 1952 and based in Sioux City, Iowa, Cloverleaf is the fifth largest cold-storage provider in the United States by refrigerated cubic feet and serves more than 360 customers. The portfolio to be acquired consists of 22 facilities, of which 21 are owned and one is managed, totaling 132 million refrigerated cubic feet. Cloverleaf’s assets are located in nine states in the central and southeastern United States, which are complementary to Americold’s existing geographic reach and expand the company’s focus in the growing protein business segment.
Americold’s portfolio will consist of more than 1 billion refrigerated cubic feet, which provides the company with greater density and diversification to better service its customers.
Temperature-controlled warehouses represent a relatively small portion of the overall logistics industry, a percentage that is growing, in investor interest due to the rapid continuous growth of e-commerce.
The U.S. Department of Agriculture and National Agricultural Statistics Service, in their most recent biannual report on refrigerated warehouse capacity, identified 3.6 billion cubic feet of gross refrigerated storage capacity, with 81 percent usable freezer space and the remaining 19 percent cooler space. According to CBRE, this represents an estimated industrial cold-storage footprint (based on a height of 24 feet and an 85 percent footprint efficiency) of 180 million square feet of industrial space.
That capacity is set to increase substantially as the way Americans shop for food undergoes change in the years ahead. In its 2019 U.S. Real Estate Market Outlook, CBRE Research noted, over the next five years, “Depending on how online grocery sales are fulfilled, up to 100 million square feet of cold-storage space for food distribution could be added or shifted from retail to industrial facilities.”