For our 17th case study, we turn to a merchant industrial development in the Lebanon Valley, one of the mid-Atlantic’s most active distribution corridors. This Windsor Crossing case study places you in the role of Alex Morgan, an investment analyst in the Northeast office of Meridian Industrial Partners (“Meridian”), a fictional national developer of warehouse and distribution properties.
In this scenario, your regional development director hands you an undeveloped site and one question: is it worth pursuing? You’ll underwrite a 200,000 SF speculative warehouse from land closing through construction, lease-up, and a merchant sale, structured through an LP/GP joint venture and a floating-rate construction loan. The deal turns on securing two credit tenants that haven’t yet signed, and on how the numbers hold up if they don’t show up on schedule.
Windsor Crossing – Background
You are Alex Morgan, an investment analyst in the Northeast office of Meridian Industrial Partners, a national developer of warehouse and distribution properties. On Monday morning, your regional development director forwards a land opportunity with a brief message: “Take a first pass. Is this worth pursuing?”
The opportunity is an undeveloped industrial site at 3135 Windsor Drive in Lebanon, Pennsylvania. Meridian is considering a modern, 200,000 SF warehouse divided into two equal suites. The business plan targets two credit-quality tenants seeking regional distribution space, with staggered occupancy dates and long-term, triple-net leases. No leases have been signed. Securing those tenants remains a central underwriting assumption…