Light industrial properties indicate growing market trends.
BKM Capital Partners and Kayne Anderson Real Estate have announced a joint venture to acquire $1.5 billion in light industrial properties across the U.S. This partnership aims to expand their presence in the light industrial market, focusing on small- and mid-bay properties. With BKM’s existing expertise and Kayne’s substantial assets, the collaboration is expected to yield significant growth opportunities amid increasing demand for industrial spaces driven by e-commerce trends.
Newport Beach, California – BKM Capital Partners and Kayne Anderson Real Estate have announced a significant partnership to establish a joint venture aimed at acquiring $1.5 billion in light industrial properties across the United States. This new collaboration represents a bold move by both companies, paving the way for extensive expansion within the light industrial real estate market.
The joint venture’s primary focus will be on small- and mid-bay industrial properties, which are characterized by their operational complexity and fragmented market. BKM Capital Partners, based in Newport Beach, has established a solid operating platform tailored for this sector, and the partnership with Kayne Anderson will enhance their ability to scale operations into new markets effectively.
BKM Capital Partners has been actively involved in the light industrial real estate sector since its founding in 2013, successfully completing over $4.5 billion in acquisitions. The company has acquired approximately 120 light industrial properties, totaling around 23 million square feet. With the goal of doubling its asset management platform from $2.5 billion to $5 billion in the next 18 to 24 months, this venture represents a transformative step for BKM.
As part of the joint venture’s initial activities, BKM recently recapitalized a nine-property portfolio encompassing 2.1 million square feet of light industrial space for $550 million. Additionally, BKM acquired five properties in Las Vegas and Phoenix, which collectively measure over 1.2 million square feet, although the prices for these acquisitions have not been disclosed. The partnership underscores the growing demand for industrial properties fueled by significant shifts in e-commerce and supply chain operations.
Kayne Anderson Real Estate, which had $37 billion in assets under management as of January 1, 2024, is confident in the long-term opportunities present within the industrial sector. The co-founder and CEO of Kayne Anderson highlighted the transformational shifts in business operations that have accelerated the need for such properties, particularly in light of the ongoing evolution of e-commerce and supply logistics.
The venturing companies are optimistic about the future of this market, as the United States continues to experience growth in the industrial real estate sector. Recent trends indicate a robust demand for light industrial facilities, underpinned by an increasing reliance on quick and efficient distribution processes following the pandemic’s impact on shopping behaviors.
In addition to recent acquisitions, BKM Capital completed the purchase of a 119,100-square-foot industrial and office complex in North San Jose for $30.7 million in January 2024. This acquisition highlights the company’s strategy to expand its footprint in strategic markets across the country.
The collaboration between BKM Capital Partners and Kayne Anderson is expected to yield significant benefits for both firms, leveraging their respective expertise and resources to capitalize on the promising landscape of light industrial properties. By joining forces, BKM can further optimize its operational platform while Kayne Anderson can enhance its diversified investment approach within the thriving industrial sector.
This joint venture marks an important development in the ongoing pursuit of growth in the light industrial real estate market, reflecting broader trends of urbanization and the evolving needs of businesses in a rapidly changing economic environment. As e-commerce continues to reshape consumer habits, investments in such properties are anticipated to offer lucrative returns in the future.
BKM Capital Partners and Kayne Anderson Launch $1.5B Joint Venture
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