Fortress Investment Group has acquired a 305,000-square-foot office building in Alpharetta, Georgia, for $93.2 million through a sale-leaseback agreement with UPS. The property, located at 12380 Morris Road, serves as the main office for UPS’s supply chain solutions division.
The transaction price equates to about $300 per square foot. Fortress completed the purchase through an affiliate and now owns the six-story building on a 13-acre site that includes a parking deck and visibility from Georgia 400. Fortress declined to comment on the deal.
The acquisition aligns with Fortress’s national net-lease strategy, which encompasses 82 million square feet of real estate holdings across the country.
UPS is restructuring its real estate portfolio as it faces slowing revenue and reduced shipping volumes. The company intends to close 73 leased and owned facilities worldwide while reducing its global workforce by 4 percent. Earlier this year, UPS exited a separate office in Sandy Springs and moved some staff into the Alpharetta location.
A UPS spokesperson stated that the company will remain a tenant at the Morris Road property but did not provide details on occupancy levels.
CBRE began marketing the property in 2022 before withdrawing the listing. Tim Sloan, vice chairman of Fortress, has previously compared challenges in the office market to those faced by malls during e-commerce’s rise, citing significant differences between submarkets in terms of value retention. Fortress has also recently supported Arcis Golf’s acquisition of three golf courses in Atlanta.
The sale supports UPS’s efforts to streamline operations as it invests more heavily in healthcare logistics and other higher-margin sectors. In its second quarter earnings report, UPS recorded a 2.7 percent decline in revenue compared to last year, totaling $21.2 billion due to weaker demand and its exit from most Amazon-related business operations. A vacant parcel adjacent to the Morris Road site remains for sale by UPS Supply Chain Solutions.
“Fortress vice chairman Tim Sloan has compared the office market’s distress to the shakeout in malls during the rise of e-commerce, noting a ‘bifurcation based upon submarket’ in how values hold up.”
A representative from UPS confirmed: “The company will remain a tenant at Morris Road but would not elaborate on occupancy levels.”
— Eric Weilbacher
