Real estate tycoon Zell invests in cold storage business

Equity Group Investments (EGI), the investment firm of real estate tycoon Sam Zell, announced on Thursday that it has invested in East Coast Warehouse (ECW), an operator of 72 million cubic feet of temperature-controlled warehouse space. controlled serving the food and beverage industry. Terms of the transaction, including whether EGI acquired a majority stake in ECW, were not disclosed.

Based in Elizabeth, New Jersey, ECW operates warehouses in the ports of New York/New Jersey, Philadelphia, Baltimore and Savannah, Georgia. It also provides drayage, local and regional trucking and brokerage services. It has been around for 65 years.

Chicago-based EGI said ECW’s management team, led by CEO Jamie Overley, will continue to run the company and retain an unspecified stake. EGI said it would provide capital for follow-on acquisitions and provide strategic support to ECW. EGI President Mark Sotir, General Manager Evan Harwood and Vice President Tyler Goldstein will join the ECW Board of Directors.

The move comes just over three months after EGI acquired Able Freight, a Los Angeles-based international air freight forwarder specializing in the transportation of perishable goods.

Zell, who founded EGI 50 years ago, became legendary for making large, high-risk purchases of often-struggling office buildings and then reselling them for handsome profits. Zell’s most famous deal was the 2007 sale of its first real estate investment trust, Equity Office Properties Trust, to The Blackstone Group (NYSE: BX) for $39 billion, a deal that was consummated just before the collapse of the US commercial real estate market. .

In recent months, Zell has publicly stated its desire to expand into the booming industrial real estate market. Zell, whose company made an unsuccessful bid late last year to acquire industrial property firm Monmouth Real Estate Investment Corp., told Monmouth shareholders that demand for logistics warehousing space triggered by e-commerce growth will continue to outpace available supply for years to come. “We do not view this imbalance as momentary – we are in the midst of a long-term, secular shift in logistics networks across the United States,” reads the letter, an excerpt of which was posted on online platform Millionacres. .

EGI’s current portfolio of 52 companies includes 14 which are classified as transportation, logistics, industrial and infrastructure properties.