The Opportunities One Company Sees In Industrial Real Estate

If the pandemic taught industrial logistics real estate investors anything it was that the “just-in-time” way of managing inventory—only keeping two weeks to 30 days of supply—is a failed strategy.

For that and other reasons, BBX Industrial has re-engaged with the logistics industrial sector where it will begin exploring mid-market assets in Florida.

The Fort Lauderdale-based company has named Mark G. Levy to serve as its president. Levy is a seasoned veteran of the commercial real estate industry with more than 28 years of experience in senior executive leadership positions with a diverse array of public and private real estate companies. 

Levy’s broad experience encompasses development, acquisitions, dispositions, and asset management. Notably, throughout his career, Levy has been involved in the development, acquisition, and asset management of over $1B of industrial real estate in key U.S. logistics markets.

Opportunities in ‘The Last Mile’

“There have been population shifts in parts of the country and areas such as Florida is one area that has grown,” Levy told GlobeSt. “With that, there is also the rampant increase in e-commerce for consumers—something the pandemic helped to drive. Today, there are constraints of supply in the industrial space.”

“This is a perfect opportunity for BBX to re-engage with and to expand into this sector. We’re looking for the mid-market sized locations of 250,000 to 300,000 square feet or less—sort of the ‘last mile’ for delivery, which there is tremendous need.”

He said that initially BBX Industrial will focus on Florida—particularly the South Florida, Orlando, Tampa and Jacksonville markets—and then could look up the East Coast in areas such as Charlotte, Washington, D.C., and New York.

“There are prolonged delays in manufacturing that aren’t going away any time soon,” Levy said. “And if you’re a volume buyer of goods, you move up the queue when supplies are available and you stock up.”

Levy said that cold storage is “evolving in a huge way and is needed for grocery and delivery and pharma. It’s a complex issue that needs a lot of specialized buildings. The capital markets are becoming more interested in financing these. These types of buildings come with more risk, but people are becoming more comfortable with them.”

He’s also looking to mixed-use industrial, “given its ability to maximize density and to serve more needs,” he said.

Levy was most recently EVP of Industrial Acquisitions for Hilco Redevelopment Partners, where he was responsible for the expansion of Hilco’s real estate development, acquisition, investment, and capital structuring activities nationwide.