Fargo Six months after Barry Batcheller sold Appareo Systems, the tech business he founded, to AGCO, a worldwide manufacturer of agricultural machinery and precision ag technology, Batcheller has also now sold the two buildings that housed them.

The $12 million property deal, which closed June 30, was with a Real Estate Investment Trust known as Dakota REIT.

Mark Richman, Dakota REIT Management’s head of business development, said the shift in property ownership will affect Appareo only in terms of “where they send their rent check.”

“With the acquisition of the two buildings utilized by Appareo Systems, Dakota REIT is able to support a successful North Dakota business and promote the mission of the NDSU Research Park. We value the relationship with the university and the state of North Dakota,” Dakota REIT President Matt Pedersen said in a press release.

Founded by Batcheller in 2003, Appareo is a product development and technology company known for researching, developing and manufacturing technology that uses artificial intelligence, mechatronics (mechanics, electronics and computing) and electronics. That has included developing technologies for the aviation, agricultural and construction sectors, such as essential “black box” technology like airborne image recorders and recoverable data modules.

Last December, when Batcheller and his son, David Batcheller, then the company’s president and chief business officer, announced the AGCO deal to employees, they said Barry would retire and David would stay on as general manager.

At the time of the sale, AGCO indicated in a press release that the large company would retain the Appareo team “and maintain its design operations in Fargo ... and Paris, France.”

Appareo employed about 150 people at that time.

The Appareo campus consists of two industrial flex buildings — the Appareo Horizons facility and the Appareo Genesis facility — with combined square footage of 88,239. The Horizons building, located at 1830 NDSU Research Circle North, was built in 2005 and the Genesis facility, 1810 NDSU Research Circle North, was completed in 2009.

Richman said the Appareo buildings represent the type of private, stable, favorably located “institutionalgrade” properties that are considered prime investment opportunities by REIT investors.

A REIT is an investment vehicle for real estate, comparable to a mutual fund, allowing both small and large investors to earn dividends from real estate investments— without having to buy, manage or finance any properties themselves, according to Investopedia.

“It is no different than going out and buying an eight-plex, except you don’t get the phone call on Saturday night to come over and unplug the toilet,” Richman says.

Dakota REIT was founded 24 years ago in Fargo and initially focused solely on Fargo-area properties, Richman says. Today, the private trust has grown to a pool of 1,100 small, medium and large-scale investors who own 80 properties throughout the Dakotas, Nebraska, Iowa and Minnesota.

The portfolio is split between 49% commercial properties and 51% multi-family housing, Richman says.

According to its website, the trust managed $590.6 million in assets in 2020.

“We look at quantity, quality and durability,” Richman says. “Is it a good property and a good tenant? Is it a 10-year or a onemonth lease? Will they consistently be able to pay bills and pay rent?”

Appareo, he adds, checked all of those boxes.

“The research tech park at NDSU is a really good area,” Richman says. “They are looking for more tenants like Appareo up there to benefit from being close to university, close to research institutions and close to the students and research going on there.

These two buildings are solid buildings.

Appareo is a very good tenant that does very well, is very creative and forward-thinking in their business. It has a good history and a good future.”

Tammy Swift is a business reporter at The Forum. She can be reached at tswift@forumcomm.com.