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Capital's Back for Class-B Industrial

Capital's Back for Class-B Industrial


KTR Capital Partners is wrapping up raising its third fund, which will have $1B of equity. VP of direct investments Ryan Stoller (fresh off a two-week honeymoon in South Africa) has been charged with investing a large part of that in the Chicago market. So we thought this active acquirer would be a great fit for Bisnow's third annual Chicago Industrial Real Estate Summit on Tuesday, May 21. KTR owns 55M SF of industrial nationally--11M SF in the Chicago area (with a recent focus on Class-A distribution facilities), Ryan tells us. He says rising rental rates and falling vacancies have created market momentum, giving landlords more bargaining power when it comes to negotiating with tenants.

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There are plenty of opportunities thanks to scarcity of product and shrinking cap rates. Institutional capital is finally warming up to the idea of Class-B product, evidenced by Blackstone's big buy of a 15-building, 2.1M SF portfolio of local warehouses from Ares Commercial Real Estate, Ryan notes. KTR's recent local acquisitions: a 450k SF Class-A building at 2407 W North Ave in Melrose Park (above); a 101k SF distribution facility at 9480 W 55th St in McCook; and a 108k SF facility at 595 Territorial Dr in Bolingbrook. Next week they'll close on a 75k SF Class-A facility in Carol Stream.