- UPS offloads real estate to Fortress for $368M as part of a broader cost-cutting strategy aimed at saving $3.5B.
- The portfolio includes four properties across key logistics hubs in Atlanta, Chicago, and Southern California, with UPS continuing to occupy one location through a leaseback.
- The move reflects UPS’s shift in real estate strategy amid declining volume, changing trade policies, and restructuring of its US operations.
Strategic Disposal
United Parcel Service (UPS) has sold a group of industrial and office properties to Fortress Investment Group for approximately $368M, reports CoStar. The sale is part of the logistics giant’s aggressive cost-cutting campaign. The move aims to offset declining shipment volumes and adapt to the evolving trade landscape.
Portfolio Details
The deal includes at least four major properties:
- Jurupa Valley, CA – 11991 Landon Drive: 765,456 SF distribution center.
- Alpharetta, GA – 12380 Morris Road: 310K SF office building, which UPS will continue to occupy.
- Bensenville, IL – 490 Supreme Drive: 230,178 SF warehouse.
- Inglewood, CA – 3624 W. Century Blvd.: 84,994 SF warehouse.
Legal representation for the transaction was provided in part by Mintz, Levin, Cohn, Ferris, Glovsky & Popeo.
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A Larger Cost-Cutting Strategy
The sale comes amid UPS’s plan to slash $3.5B in costs through real estate consolidation, workforce reductions, and operational efficiencies. The company reported closing 74 locations in the first half of the year—68 of them permanently—as part of this strategy.
CEO Carol Tomé emphasized the impact of “volatile” trade dynamics. She noted the company’s need to adapt to falling package volumes, particularly from key customer Amazon.
Real Estate Restructuring
UPS is actively reshaping its real estate footprint. In July, it vacated offices at 35 Glenlake Parkway in Atlanta, relocating 500 employees to its headquarters next door. These adjustments, the company says, are designed to streamline operations and support automation across its domestic logistics network.
As of June 30, UPS had logged $37M in asset write-downs related to closed properties and equipment.
Why It Matters
UPS’s property sales reflect a growing trend of sale-leaseback transactions in the logistics sector. Companies are using these deals to unlock capital and optimize their footprints. For investors like Fortress, the acquisition provides stable income streams backed by essential logistics infrastructure.
What’s Next
As UPS continues its network-wide restructuring, expect further property disposals and consolidations. The shipping giant appears committed to a leaner, more automated future. It is prioritizing efficiency over physical footprint.
