We’ve acquired a 202,000 square foot distribution center in Atlanta, Georgia, for a purchase price of roughly $30.4 million. The property is located about 20 minutes from downtown Atlanta and within five minutes of both I-75 and I-285, while the Atlanta International Airport is less than ten minutes away.

As demand for more and faster delivery continues to grow, we believe that “last-mile” distribution facilities located close to major population centers will become increasingly important for retailers.

This acquisition was made by a joint venture between two Fundrise sponsored funds, the Fundrise Flagship Fund, which invested roughly $5.8 million, and the East Coast eREIT, which invested roughly $641,000. We also financed the acquisition with a senior loan of $24.6 million, and we have budgeted for other soft costs and fees, bringing our total projected commitment to roughly $31 million.

Strategy

Core Plus

Acquire and operate stabilized, cash flowing real estate

  • Risk-return profile: Moderate
  • Expected timing / delay of returns: Shortly after acquisition
  • Expected source of returns: Income with some growth

More about our strategies

Note that this section is intended to provide a general overview of the Core Plus strategy for educational purposes only, and is not meant to be representative of the specific details of any individual investment. All investments involve risk and there are no guarantees of any returns.

Business plan

Completed in 2020, the building is well-suited for a variety of industrial applications, including as a last-mile distribution facility. Like much of the rest of the Sunbelt, Atlanta has expanded at an exceptional pace over the last decade, with population growth roughly three times the national average. As the city grows, the businesses based there require efficient distribution systems, which are serviced by properties like this one.

A last-mile distribution center, also referred to as a terminal building or sorting center, acts as a handoff point to connect 18-wheeler trucks, which typically carry goods in bulk across longer distances, with the smaller vehicles that make the final leg of the journey to drop off packages at individual homes and businesses.

Currently, 100% of the property’s space is leased to a freight company, with roughly four years left on their term. The tenant uses this facility to service some of Atlanta’s largest businesses, including multiple Fortune 100 companies. While the current tenant is not specifically part of an e-commerce logistics and delivery infrastructure, the property’s excellent position could make it highly attractive to businesses who service the e-commerce space in the future. As we expect consumers’ demand for and reliance upon e-commerce to steadily grow in the coming years, we expect that potential function of the property will also help drive its growth.

We plan to hold and manage the property over the long term, re-leasing the space as necessary when the current lease expires, with the goal of earning regular rental income and then eventually selling the property at a profit.

Why we invested

  • Prime location: Just 20 minutes from downtown Atlanta and within five minutes of two major highways, the property is well-positioned to serve as a distribution center for businesses across the metropolitan area.

  • Healthy local economy: Between 2010 and 2019, the Atlanta area’s population grew nearly three times faster than the national average, according to the U.S. Census. As the area continues to grow, so does the need for efficient distribution of freight and goods, making well-positioned industrial properties especially valuable.

  • High-demand property type: In order to efficiently distribute goods across major metropolitan areas, companies ranging from online grocery delivery to e-commerce retailers need space in highly specific locations with access to regional transportation. In major cities, like Atlanta, there is a limited supply of industrial sites that meet those requirements, increasing the potential value of properties like this one.

As always, if you have any questions or feedback, please visit our help center or reach out to us at investments@fundrise.com.

Additional Information: An investor in the Fundrise Real Estate Interval Fund (the “Flagship Fund”) should consider the investment objectives, risks, and charges and expenses of the Flagship Fund carefully before investing. The Flagship Fund’s prospectus contains this and other information about the Flagship Fund and may be obtained here. Investors should read the prospectus carefully before investing.