With industrial pricing remaining tight, investors look to cold storage, truck yards and other subcategories
As the industrial market has seen soaring valuations and compressed cap rates, investors are turning to alternatives within the category — everything from cold storage to truck yards, also known as industrial outdoor storage. The big question is, how are investors seeking higher returns while still benefiting from the attractive economic trends that have caused the industrial sector to prosper?
As yields compress across the industrial sector, Drake Real Estate Partners is targeting assets with strong fundamentals in sectors and equity sizes below the radar of most institutional capital, says David Cotterman, co-founder and president of the firm. These include smaller, single-tenant assets in good, infill locations with strong supply/demand dynamics that can be aggregated into portfolios, as well as niche property types within the industrial sector that benefit from the same tailwinds as traditional warehouse/distribution assets.
“We are seeing strong secular demand