Private equity firm H.I.G. Capital, through its affiliate, H.I.G. Realty Partners, has purchased a 55-property industrial outdoor storage (IOS) portfolio, totaling 2.3 million square feet in 20 states.
The portfolio is 100 percent leased with a weighted average tenant tenure of 12 years. The properties are located in sub-markets with market rents approximately 50 percent higher than the portfolio’s existing rents, which looks to provide H.I.G. with a mark-to-market opportunity. With this acquisition, H.I.G. aims to launch its IOS platform to consolidate the market of small-box warehouses and distribution centers.
“This acquisition gives H.I.G. an immediate, critical mass portfolio of IOS assets, allowing us to create a platform to consolidate a highly fragmented space, characterized by limited institutional competition and unique supply/demand fundamentals,” comments David Hirschberg, co-head of H.I.G. Realty Partners.