Despite Record High Prices, There’s No End to Investors’ Appetite for Industrial Assets
January 5, 2022 | Patricia Kirk | WealthManagement.com
With industrial real estate values at record levels and cap rates compressing by 50 to 75 basis points year-over-year by the end of 2021, one would expect investors to be backing off a bit. But that just isn’t happening in today’s market, according to Chris Riley, vice chairman with CBRE’s investment properties group based in Atlanta. “There’s been no pullback in appetite or transaction activity for industrial properties.” In fact, he notes that aggressive industrial acquisition activity by large funds and institutional investors has ramped up.
Just this week, for example, CBRE Investment Management agreed to buy a global portfolio of logistics assets from Hillwood Investment Properties in a deal valued at $4.9 billion. The portfolio includes properties in both the U.S. and Europe, with two-thirds of the assets comprising leased existing buildings and one-third in various stages of development and leasing, according to The Wall Street Journal.
Three weeks ago, AXA Investment Management Alternatives acquired a 23-property industrial portfolio from Dermody Properties Industrial Fund II for $1.2 billion, with another deal under way with the same seller to buy nine industrial development projects for an additional $850 million.
