Dealmaker: Oxford Properties Group To Buy KKR Industrial Portfolio for $2.2B
Oxford Properties Group, Toronto, agreed to acquire a 14.5-million-square-foot infill and light industrial portfolio from KKR, New York, for $2.2 billion.
JLL Industrial Capital Markets advised Oxford and CBRE National Partners advised KKR in the transaction.
The portfolio includes 149 distribution buildings in 12 major U.S. industrial markets, including California’s Inland Empire, Dallas, Atlanta, Phoenix, Chicago, Houston, Tampa, Orlando, San Diego and the Baltimore-Washington corridor.
“High-quality, infill, consumption-driven industrial portfolios of scale trade infrequently, so this transaction is an important next step for Oxford to build a large-scale industrial business in the U.S.,” said Ankit Bhatt, Vice President of Investments at Oxford Properties. “We believe scale will become an important differentiator for industrial real estate operators, and we continue to pursue opportunities in the U.S. light industrial sector.”
KKR started acquiring the portfolio of infill warehouses in high barrier-to-entry markets in 2018. Roger Morales, KKR Partner and Head of Real Estate Acquisitions, and Ben Brudney, Director on KKR’s real estate team, assembled the portfolio though more than 50 individual property transactions.
“Four years ago, we set out to create a large, stabilized portfolio that would benefit from secular changes in the logistics sector largely driven by e-commerce and consumer preference changes,” Morales said. He noted the transaction reflected the “tremendous market opportunity” industrial real estate offers.
Owned by OMERS, the Canadian pension plan for Ontario’s municipal employees, Oxford has grown its global industrial business substantially in recent years. In January 2019, it acquired IDI Logistics with Ivanhoe Cambridge for $3.5 billion. Last year it became a significant investor in Lineage Logistics, Novi, Mich., the world’s largest cold storage logistics provider. And in January it agreed to acquire M7 Real Estate, London, a large European logistics investment and asset manager.
