Residential Giant Jumps Into Industrial

There have been a number of announcements recently about newly launched industrial funds.

But not too many have come from major players in the multifamily business. That changed with Alliance Residential Co.’s announcement that it has launched Alliance Industrial Co. Alliance is the No. 2 developer and the No. 44 owner on the NMHC’s list of top companies in the apartment industry.

Alliance Industrial Co. will be focused on capitalizing on the e-commerce-fed demand in essential warehouse logistics and distribution space development. The company, which is based in Houston, will leverage Alliance Residential Co.’s national acquisition, development and construction infrastructure and leadership.

President and CEO Cyrus Bahrami will lead Alliance Industrial Co.’s national operations, launched in May. Bahrami, a senior partner in Alliance’s residential platform, plans to leverage Alliance’s relationships and track record in the capital markets and its national infrastructure to create and run an industrial platform using a model similar to Alliance Residential.

“This will be a decentralized model with a national backstop for accounting, finance and capital support. However, the business plan will be executed by local industrial leaders with deep market knowledge and development expertise in the industrial space,” said Bahrami in a prepared statement.

Alliance sees e-commerce continuing to grow as a percentage of national sales, which will create a critical need for more quality industrial warehouse and distribution space, according to Bahrami. To ramp up in the industrial market, Alliance hired Chad Parrish, formerly principal of Molto Properties and Market Leader of First Industrial’s Houston market, as managing director of Texas. He will oversee the development, investment and construction activities in Austin, Dallas, Houston and San Antonio

Parrish has led the investment and development of more than $440 million in industrial projects, representing over 6.5 million square feet in six markets since 2014.

“Texas is an ideal market to launch and establish Alliance Industrial,” Parrish said in a prepared statement. “With the in-migration of population, major transportation and logistics hubs in the region, and a pro-business environment, Alliance Industrial looks to move quickly to meet the ever-increasing industrial demand.”

CFO Brandon Fleetwood, VP of Construction J.D. Devine, and Development Director David Adame are other members of the senior management team. They all have previously served as leaders at Alliance Residential Co.

The Alliance announcement isn’t the only major industrial news this week. On Monday, Invesco Real Estate and Jera Asset Management announced they formed a joint venture called Mercury Trust to purchase up to $3 billion in industrial assets over the next three to five years.

Mercury Trust will acquire industrial real estate focusing on distribution centers, logistics properties, and cold storage warehouses. The joint venture was seeded with nearly $500 million of assets throughout the country acquired or under contract to be acquired soon. In addition, to help fund future acquisitions, Mercury Trust obtained a credit facility totaling $675 million.