Apollo lends Brookfield $130.5M for a Rialto logistics build

Apollo has provided $130.5 million of construction financing to Brookfield for Locust Gateway Logistics Center, a 664,859-square-foot Class A industrial project in Rialto, Calif., and the debt carries a five-year term, Commercial Observer first reported. CBRE's Tom Rugg, Tom Traynor, Val Achtemeier, Mark Finan and Henry Fenmore arranged the transaction; Apollo, Brookfield and CBRE declined to comment, according to the report.

Divided by the planned square footage, the loan works out to roughly $196 a foot of building, a loan basis rather than a project cost. The site at 2125 West Lowell Street sits in an Inland Empire city 54 miles east of Los Angeles, on undeveloped land formerly part of the old Rialto Airport, an airfield closed for 12 years. The coverage does not put a number on Brookfield's equity, the land value, or the expected rent.

Five years is the whole term, the detail a construction lender has to price against delivery and lease-up on a building this size, and Apollo's commitment suggests either a short schedule or a takeout already contemplated—the report does not say which. Apollo is an asset manager, and the placement fits the argument PWD has been making: patient capital is doing the extending in commercial real estate as banks step back down the stack.

Whether the package carries extension options is a distinction the coverage does not draw, and it matters on a 664,859-square-foot build, where a straight five-year maturity implies completion and lease-up that both land inside it, with nothing left over for a slow market.

The comparison is a construction loan written against land instead of a building: a $41.7 million loan on Onni's Seattle towers, taken against a land basis set in 2018 on a $358 million project that still had no permits. That loan financed a wait; the Rialto loan finances a build, with the clock running against a construction start rather than a hold.

The report carries no rent, no tenant and no completion date—the numbers against which a five-year maturity ultimately gets measured. Until one of them surfaces, the term itself is the only read anyone outside the deal has on Apollo's view of the Inland Empire.