Outsized Demand for Logistics Real Estate Has KKR On The Move
The firm is investing in eight markets, with projects underway in Atlanta, Dallas, Denver and Orlando.
Major US markets are experiencing outsized demand for logistics real estate driven by demographic trends and the proliferation of e-commerce, giving reason for KKR to expand its presence in the sector through a new development initiative.
To lead these increased efforts, KKR hired industry veterans Matt Singleton and Greg Bradley to join KKR’s Alpha Industrial Properties to oversee construction and development including ground-up development of Class A industrial logistics properties.
KKR’s wholly owned U.S. industrial real estate platform, Alpha Industrial Properties (AIP), has begun development of sites in Atlanta, Dallas, Denver and Orlando and has another four sites in pre-development.
The eight projects are expected to deliver 1.8 million square feet of industrial space.
Last month, GlobeSt reported that KKR acquired seven industrial buildings, totaling nearly 1.8 million square feet, in three separate transactions for a combined purchase price of $272 million. The assets include class A properties in Dallas, Fort Worth and Atlanta.
The properties are currently leased to tenants including an e-commerce business, global logistics and manufacturing companies and a national health and beauty retailer.
Funding for its latest projects is being provided by KKR Real Estate Partners Americas III, KKR’s Americas opportunistic equity real estate fund.
KKR was provided with a $200 million construction facility to finance its investments in industrial developments nationwide from BMO Harris Bank and Square Mile Capital.
KKR has committed or acquired approximately $7 billion of U.S. logistics assets across its portfolio since 2018 and currently owns over 45 million SF of industrial real estate.