1/ A few reasons why we are investing heavily into Class B #Industrial (CBI).
1. For every $1B increase in online sales, 1.25M sf of industrial real estate is needed. We believe online sales is a tailwind.
2. Infill nature (b/c of decade built)optimizes for last mile
1. For every $1B increase in online sales, 1.25M sf of industrial real estate is needed. We believe online sales is a tailwind.
2. Infill nature (b/c of decade built)optimizes for last mile
2/ distribution needs.
3. Travis Kalanick, founder of Uber, purchased Cloud Kitchens after leaving Uber. They are acquiring Class B Industrial to be used as ghost kitchens. We believe many more industries and businesses will continue to understand there is a meaningful
3. Travis Kalanick, founder of Uber, purchased Cloud Kitchens after leaving Uber. They are acquiring Class B Industrial to be used as ghost kitchens. We believe many more industries and businesses will continue to understand there is a meaningful
3/ part of their business that can be outsourced to this more affordable and functional real estate. Also, food/grocery delivery has major tailwinds - still in early innings.
4. Most new mixed-use districts in major cities are redeveloped industrial parks. CBI assets are
4. Most new mixed-use districts in major cities are redeveloped industrial parks. CBI assets are
4/ on large tracts of land and offer a better canvas for place making. We are seeing buildings torn down or repurposed. It is a depleting asset class with a tenant base that still has high demand for the space.
5. Due to price of infill land, it is cost prohibitive to
5. Due to price of infill land, it is cost prohibitive to
5/ re-build. When was the last time you saw an infill industrial park being built.
6. Amazon just ordered 100,000 sprinter vans that are loaded at grade level, not dock level. Class B industrial facilities, not only offer last mile, but they offer grade level loading.
6. Amazon just ordered 100,000 sprinter vans that are loaded at grade level, not dock level. Class B industrial facilities, not only offer last mile, but they offer grade level loading.
6/ Can’t be underestimated.
7. If you get a raise, you might move from a Class B apartment to a Class A apartment. If your business does better, you might move from a Class B office to a Class A office. If your business that occupies Class B industrial is prosperous, it
7. If you get a raise, you might move from a Class B apartment to a Class A apartment. If your business does better, you might move from a Class B office to a Class A office. If your business that occupies Class B industrial is prosperous, it
7/ grows within the same asset class. There is no need to move to a Class A building unless there is a functionality need.
8. As Cannabis is legalized across the US, most all major grow facilities are built in Class B industrial facilities. There is a major tailwind in
8. As Cannabis is legalized across the US, most all major grow facilities are built in Class B industrial facilities. There is a major tailwind in
8/ Cannibas legalization.
9. Individual deal sizes (unless large portfolio’s) fall under the institutional threshold. Less competition.
10. Cap ex is very predictable. Mainly paint and carpet and minimal exterior upgrades. Largest items are roofs, which is predictable.
9. Individual deal sizes (unless large portfolio’s) fall under the institutional threshold. Less competition.
10. Cap ex is very predictable. Mainly paint and carpet and minimal exterior upgrades. Largest items are roofs, which is predictable.
9/ No platinum toilets requested by company CEO’s in CBI!
11. They are boring, unsexy properties, for the most part. That alone keeps several investors away!
12. Very diverse tenant base across all industries. 
We have acquired 2.5M sf to date and would like to own 10M
11. They are boring, unsexy properties, for the most part. That alone keeps several investors away!
12. Very diverse tenant base across all industries. 
We have acquired 2.5M sf to date and would like to own 10M
10/ sq ft by 2023. Let’s talk if you know someone who is interested in selling. Don’t tell them all the reasons we like the asset type until after we are under contract. ;). JK.
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