WASHINGTON, DC – October 4, 2022 – PRP announced today that it has formed a joint venture with KDC of Dallas, TX to build the new Gulf Coast Vehicle Terminal for Volkswagen Group of America (VWGoA). The new Gulf Coast hub, once completed, will sit on 120 acres in Freeport, Texas. The project is expected to break ground in October and will be operational in early 2024. Total project cost is estimated to be $114MM.
The new hub will consolidate VWGoA’s current port operations in Houston and Midlothian. When completed, the facility will include several service buildings totaling over 200,000 square feet and asphalt parking for over 16,000 vehicles, trucks, and railcars. The property will enable Volkswagen to import approximately 140,000 vehicles per year from its production hubs in Mexico and Europe, serving nearly 300 retail dealers in the United States. The new hub will also allow utilization of low-emission LNG vessels, supporting Volkswagen’s goal to improve the environmental footprint of its global logistics and enhancing PRP’s commitment to ESG initiatives.
“We are thrilled with our new partnership with VWGoA. This transaction adds another blue-chip company to PRP’s growing list of first-class tenants,” said Paul Dougherty, President of PRP. “This asset perfectly complements PRP’s net lease portfolio of newer construction facilities leased by high quality investment grade tenants on a long-term basis in strong US logistics markets. We look forward to working with KDC to build this facility for VWGoA.”
The venture between PRP and KDC has entered into a long-term ground lease with Port Freeport, while Volkswagen Group of America will lease the new hub from the venture on a 20-year commitment.
Given its coastal location in Texas, Freeport is a critical logistic market within the United States. The Port has been an increasingly important player especially in the vehicle import/export space. Today, Port Freeport manages over 30 large vehicle ships a month. Global carriers offering roll on/roll off cargo services at the port include Hoegh Autoliners, Glovis, Liberty Global Logistics, Sallaum, and Grimaldi Lines. Companies such as Amports, Ports America, and Red Hook Terminals already have vehicle logistics operation terminals at the port as a result of these global services.
JLL, Volkswagen Group of America’s exclusive real estate partner, assisted VWGoA in the site selection process for a consolidated port facility along the Gulf of Mexico.
PRP is a real estate investment management company with a focus on mission-critical logistics and corporate headquarters facilities leased to investment-grade companies on a long-term basis, investments in Opportunity Zones, investments in existing data centers and land zoned for data center use, value-add multifamily apartments and value-add office. Founded in 2005, PRP executes these strategies and asset manages a national portfolio of assets on behalf of its institutional investors, family offices and financial institutions. PRP has proven expertise in selecting and managing attractive risk adjusted real estate investments located in major markets throughout the United States. Since its formation, the company has acquired, developed or invested in over 50 assets with a value in excess of $6 Billion in all property sectors. PRP is privately held and is headquartered in Washington, DC. PRP is a creative buyer and seller of real estate and considers a variety of equity and debt investment structures. For more information on PRP, please visit www.prprei.com.
KDC is a leading corporate development and investment firm for companies across the country. For more than 30 years, KDC has produced approximately 33 million square feet valued at over $9 billion. KDC addresses the future of Corporate America by developing walkable, mixed-use urban environments anchored by notable clients. Beyond corporate office, the firm specializes in data center and broadcast studio build-to-suits. KDC's portfolio includes developments for FedEx, J.P Morgan Chase, Liberty Mutual, Raytheon, State Farm (Dallas and Atlanta offices), and Toyota North America. KDC is headquartered in Dallas and is supported by a national team with offices in Atlanta and Charlotte, North Carolina.
About Volkswagen Group of America, Inc.
Volkswagen Group of America, Inc. (VWGoA) is a wholly owned subsidiary of Volkswagen AG (“Volkswagen Group”), one of the world’s leading automobile manufacturers and the largest carmaker in Europe. VWGoA houses the U.S. operations of a worldwide family of distinguished and exciting brands including Audi, Bentley, Bugatti, Lamborghini, and Volkswagen. Volkswagen Group of America Chattanooga Operations, LLC, a wholly owned subsidiary of VWGoA, operates a state-of-the-art assembly facility in Chattanooga, Tennessee, while VW Credit, Inc., another wholly owned subsidiary of VWGoA, provides financial services. VWGoA’s headquarters are in Herndon, Va. The company has approximately 8,000 employees in the United States, and sells its vehicles through a network of approximately 1,000 independent dealers.