Industrial Logistics Properties Trust is suddenly looking a lot less vacant. The REIT says it has locked in two enormous leases, a 532,364-square-foot warehouse in Indianapolis and a 2,237,547-square-foot ground lease in Kapolei, Hawaii, which together top 2.7 million square feet and push portfolio occupancy to roughly 98 percent. The Indianapolis lease kicked in on May 1, bringing back to life a building that had been empty since August 2024, while the Kapolei ground lease begins July 1 and runs for 53 years. Company leaders are pitching the one-two punch as a way to eliminate ILPT’s two largest vacancies and turn scarce Oʻahu land into a long-dated income stream.
In a press release via Business Wire, ILPT laid out the deals in detail. The Indianapolis asset at 9215–9347 E. Pendleton Pike is now under an approximately 10-year lease, and the Kapolei arrangement is a long-term ground lease on the 91-399 Kauhi Street parcel. The company said the two transactions “fully address the two largest vacancies” in its portfolio and that the ground-lease structure is expected to “generate durable income for decades to come.”
Indianapolis Vacancy Finally Filled
ILPT had already circled the Indianapolis site as a must-solve problem for 2026 and even baked a leasing assumption into its second-quarter guidance, according to the company’s Q1 2026 presentation. That presentation assumed the 532,000-square-foot vacancy would be leased in June and that filling it would contribute roughly 2.8 percent to midpoint NOI, so the May 1 start date could pull some of those cash-flow benefits forward.
Local market research helps explain the urgency. Indianapolis has been racking up rapid absorption and shrinking big-box vacancy, which tightens the options for large distribution users and improves the backdrop for landlords trying to backfill massive spaces. In other words, ILPT chose a favorable moment to finally put a tenant in a building that had been sitting dark.
Kapolei Ground Lease Monetizes Scarce Oʻahu Land
The Kapolei transaction is structured as a 53-year ground lease that begins July 1 and covers more than 2.2 million square feet of land. ILPT keeps ownership and collects rent over the long haul, while the tenant controls what happens on the surface. The company framed the deal as a way to monetize hard-to-replicate Hawaii land without selling it outright, preserving future options such as rent resets or other value-capture moves…