Oxford, EverWest Form $1B JV Targeting Infill Industrial

Oxford Properties Group and EverWest Real Estate Investors have formed a joint venture to target the US infill industrial portfolio growth.

The JV will acquire and develop approximately $1 billion of infill, small-bay, industrial properties across the US.

The JV also announced the acquisition of six initial assets totaling more than 1.1 million square feet across Denver, San Diego, Portland, Phoenix, Houston and Nashville, at a combined value of $160 million.

Proximity to Urban Centers a Key

The JV will target a mix of core-plus, value-add investments and developments, focusing primarily on infill industrial properties across major high growth industrial markets. 

Benefitting from proximity to urban centers, the properties will be well positioned to meet the rapid increase in demand for fulfillment needs and provide occupiers with locations close to their customer base.

Oxford will provide the primary source of capital and drive overall strategy for the JV, with EverWest leading the acquisitions and day-to-day operations for each asset. 

It is almost a cliche now to say that demand for industrial assets is strong. It is, however, useful to note that this demand will continue for various reasons. 

“The current demand from investors for light industrial assets continues to strengthen, particularly with the re-emergence of companies that perhaps hibernated during the pandemic, or new companies that were created during Covid,” BJ Turner, founder of Dunleer, tells GlobeSt.com. 

‘Light’ Industrial Spaces an Ideal Size

“Given most assets in the product classification fall within infill and irreplaceable locations, we are experiencing significant rent growth, rapidly dwindling availability, and robust user demand,” Matteson Hamilton, managing director and partner for Stream Realty Partners’ industrial division in Houston, tells GlobeSt.com. 

“As the average tenant size tends to be below 35,000 square feet, light industrial assets are insulated from the new development supply, as the larger buildings are not able to accommodate the smaller users due to building dimension and divisibility constraints. Therefore, we are very bullish on light industrial and Class B assets for many years to come.”

Oxford Active in Recent Acquisitions

As for Oxford Properties, this partnership complements the company’s recently acquired $2.2 billion infill portfolio from KKR, and existing 50% investment in IDI Logistics, according to Vice President of Investments Ankit Bhatt. “With strong market fundamentals and growth prospects, industrial remains one of our highest conviction sectors and core to Oxford’s North American strategy,” he says in prepared remarks. 

Oxford has substantially grown its US industrial business over recent years with significant acquisitions, including its recent transaction with KKR. The company has invested across three main logistics verticals of big-box, infill light industrial, and niche/alternatives.