DALLAS— Amidst one of the strongest cycles for the Dallas industrial market, Dallas-based Sealy & Company formed a joint venture with AEW Capital Management.

The initial investments is comprised of a 20-building industrial portfolio totaling 1.9 million square feet in Texas and an industrial property in Atlanta, Georgia. The majority of the warehouse/distribution and flex portfolio is located in the Dallas/Fort Worth area.

"We were pleased with the timing and the opportunity this JV afforded both our companies" said Scott Sealy Jr., vice president and business development.  "We were able to quickly acquire a portfolio with stable cash flow, market diversity, and a good mix of tenants – in submarkets that are exhibiting strong leasing velocity".

The Dallas industrial market saw the highest level of absorption in a decade in 2013, according to a report from CBRE. The Northwest submarket in Dallas, where a large portion of the properties are located, had the lowest availability rate in the city at 9.5%.

The JV will focus on assets and portfolios of $5 to $100 million in major industrial markets.

"The Sealy/AEW JV is targeting acquisitions in Sealy's current footprint which includes each major market in the Southeast/Southwest.," added Sealy. "We also follow a few secondary markets that show strong fundamentals.  In each marketplace we pursue traditional warehouse properties with functional characteristics."

In addition to this JV, Sealy & Company is the sponsor of SSEP, a private equity offering and diversified limited partnership, primarily comprised of industrial real estate assets.

AEW formed the joint venture on behalf of AEW Partners VII, L.P., the seventh in AEW's opportunistic fund series.