KKR Pays $377M for Industrial Portfolio
KKR has purchased an industrial portfolio of about 2 million square feet across six Class A logistics assets in gateway and Sun Belt markets for some $377 million. Capital accounts advised by KKR funded this investment.
On average, the fully leased properties feature 35-foot clear heights and a 2014 completion year. The facilities are located throughout infill submarkets in Seattle, Atlanta, Philadelphia, New Jersey, as well as the San Francisco Bay Area.
KKR Managing Director Ben Brudney said, in prepared remarks, that high quality assets in good locations, with diverse demand drivers and accommodative labor forces, will become more and more difficult to find in the following years.
From a blank slate to $75 billion in assets
Starting with a blank slate in 2013, KKR’s global real estate business had $75 billion in assets as of June 30, 2024. The company’s total warehouse acquisitions in the U.S. total nearly 6 million square feet year-to-date.
One of the firm’s recent purchases is Park 8Ninety, a 12-building industrial logistics park in Missouri City, Texas. Artis Real Estate Investment Trust sold the asset for about $234 million in July. The 1.8 million-square-foot, master-planned campus came online in phases between 2017 and 2022.
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KKR bought the asset through its Real Estate Partners Americas III fund, as well as capital accounts under its advisement. The fund closed in 2021 at $4.3 billion—more than tripling REPA I which closed at $1.2 billion and doubling REPA II which closed at $1.9 billion—and is dedicated primarily to opportunistic real estate investments in the U.S.
Another REPA III-funded acquisition closed last year, when KKR bought two newly delivered industrial assets in separate transactions for roughly $250 million. Located in Phoenix and Palmetto, Ga., the two properties encompass 2 million square feet.
However, not all of KKR’s industrial investments involved REPA III. In May, the firm paid $76.2 million for a two-building industrial asset in Nashville, Tenn., financing the purchase with a $42 million loan issued by Forethought.
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