Covenant Logistics closed the sale of its California terminal for roughly $43.5 million in cash on Sept. 30, according to a securities filing.
The price of the real estate fell after another buyer walked away from a $45 million deal to buy the freight terminal in June.
Announcing the second agreement in an August filing, the Chattanooga, Tennessee-based carrier said that the new buyer had paid a $2 million nonrefundable deposit. The company expects a $37.5 million pretax gain from the sale.
Covenant has relocated the terminal’s employees and equipment to other locations, and it expects the sale to lower its Southern California operating costs by about $500,000 per year with no disruption in service, the company said.
Covenant isn’t the only carrier rethinking its footprint to capitalize on high industrial real estate prices. TFI International sold a Southern California terminal in Q2, and Heartland Express sold a maintenance facility in Rancho Cucamonga, California, in May and began leasing it back.
