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AHF Products sells five of its plants and leases them back
Listen to this articleAHF Products, which last month purchased three Armstrong Flooring plants, sold and leased back five other properties in its industrial portfolio.
The Lancaster-based hard-surface flooring manufacturer, driven in part by industry consolidation as well as investor demand for net leased industrial properties, plans to use the money to grow the company, according to real estate firm Newmark, which represented AHF.
The sale-leaseback includes five manufacturing and distribution facilities covering 1 million square feet in Tennessee, Arkansas, Missouri and Kentucky.
Fully occupied by AHF, the properties are subject to a long-term absolute net lease with annual rental escalations. They are within strategic proximity of AHF’s suppliers, lowering manufacturing costs and allowing the company to price its products competitively, a release said.
“Despite uncertainty in the marketplace and growing concerns of a recession, this portfolio garnered extensive interest from numerous institutional sale leaseback investors,” said Newmark Managing Director Briggs Goldberg. “Navigating through the turbulence of the past 90 days – including a 100-basis-point increase in treasuries—we maintained a competitive environment, which allowed us to hold the buyer to originally agreed upon terms.”
The three manufacturing facilities AHF acquired from Armstrong Flooring Inc., after Armstrong filed for Chapter 11 bankruptcy, are in Lancaster; Beech Creek, Pennsylvania; and Kankakee, Illinois.
Paula Wolf is a freelance writer
