GFH Partners transfers Chicago logistics facility for $151 million

GFH Partners has completed the $151 million sale of a major logistics distribution facility near Chicago to Michelin North America, marking its fourth exit from its United States industrial and logistics portfolio.

The Dubai International Financial Centre-based investment manager said the transaction involved a two-million-square-foot distribution centre and adjoining land in Wilmington, Illinois. The property was sold in partnership with Silver Creek Development, which jointly acquired the asset with GFH Partners in February 2021.

The sale closed on October 6, 2026, transferring ownership to Michelin, which has occupied the facility since 2015. GFH Partners said the disposal generated investor returns consistent with the fund’s targeted investment objectives, although it did not disclose the investment’s internal rate of return or net profit.

GFH Partners, the global real estate investment arm of GFH Bank, completed the transaction alongside GFH Partners Fund Management. The disposal represents another portfolio realisation amid difficult conditions for commercial property investment, including elevated borrowing costs and constrained financing availability.

The facility occupies a 91-acre site approximately 60 miles southwest of downtown Chicago. It is one of Michelin’s two super-regional distribution centres in the United States and handles a substantial proportion of the tyre manufacturer’s imported inventory.

The distribution operation supports more than 400 employees and provides access to Interstate 55 and the BNSF railway network, connecting Michelin’s supply chain with major transport corridors serving markets across the country.

GFH Partners said it undertook several operational improvements during its ownership, including expanding trailer parking capacity and negotiating an early extension of Michelin’s lease beyond its previous November 2027 expiry.

These measures were intended to strengthen the property’s operating position and support Michelin’s distribution requirements before the eventual sale to its longstanding tenant.

Nael Mustafa, chief executive officer of GFH Partners, said Michelin’s decision to acquire the property demonstrated its importance to the company’s operations.

“There is no stronger endorsement of an asset’s quality than its tenant choosing to own it,” Mustafa said.

He added that GFH Partners had worked with Michelin throughout the investment period to improve the facility and support its operations, enabling the investment manager to complete the disposal for its investors.

Mustafa said the transaction reflected the company’s approach of acquiring strategically located properties occupied by established tenants and improving their value through active management.

The sale comes against a challenging commercial real estate environment in the United States, where higher interest rates have affected property valuations, financing arrangements and transaction activity.

GFH Partners identified restricted debt availability, lower transaction volumes and differences between buyers’ and sellers’ pricing expectations as continuing obstacles to property disposals.

Nevertheless, industrial property transactions in the Chicago metropolitan area have shown stronger activity during 2026. Cushman & Wakefield recorded approximately 48.7 million square feet of industrial property sales during the first nine months, representing a 72 per cent increase over the corresponding period of 2025.

The investment manager originally entered the Wilmington property investment through a partnership with Silver Creek Commercial Development. GFH’s acquisition announcement in February 2021 valued the transaction at more than approximately $135 million.

The original investment was structured around an established industrial tenant occupying a large distribution facility with access to interstate highways and important freight infrastructure.

The property is located at 29900 South Graaskamp Boulevard within the wider Elion Logistics Park 55 development in Will County. Michelin uses the centre to distribute tyre inventory to dealers and automotive manufacturers across several American markets.

The building was developed for Michelin’s operational requirements and subsequently expanded to accommodate additional distribution capacity. Its established tenant relationship remained central to the property’s investment profile throughout GFH Partners’ ownership.

Following the disposal, GFH Partners said it would continue investing in American logistics properties through its transportation logistics platform, which concentrates on specialised industrial facilities serving freight and distribution operations.

The platform targets truck terminals, fleet yards, equipment storage facilities, shipping container yards and other properties supporting transportation activities.

Unlike conventional warehouse investments, these properties frequently require substantial outdoor operating space and infrastructure suited to vehicle movements, equipment handling and freight storage.

GFH Partners said its investment strategy continued to emphasise locations with established transportation links, reliable occupiers and operational importance to tenants.

The Wilmington facility had maintained full occupancy under Michelin throughout the investment period. Its distribution operations account for approximately 35 per cent of Michelin’s imported inventory in the United States, according to GFH’s property disclosures.