Morgan Stanley Leads $1B Refi Of Investcorp Industrial Portfolio
Global alternative asset manager Investcorp secured a $1B loan to refinance debt covering a 14M SF U.S. industrial portfolio.
A group led by Morgan Stanley is providing the capital to the Bahrain-based firm to refinance more than 130 buildings in more than a dozen markets, Investcorp announced Thursday.
The debt covers two portfolios totaling 128 properties and nearly 14M SF, with roughly half the properties split across eight prime industrial markets and the remaining in high-growth cities. It will also refinance the mortgage on two Class-A industrial parks, each with multiple buildings, totaling 390K SF in Phoenix and Orlando, Florida.
Investcorp secured the debt against the backdrop of a softening industrial market. The national vacancy rate is 10% higher than it was a year ago and 60% above prepandemic levels, with third-quarter leasing totaling 158M SF, a 3.2% decline from the prior year, Cushman & Wakefield reported this week.
Asking rents are flat nationally but are climbing in the South and Midwest while slipping in the West and Northeast. New construction starts are waning, but the delivery of nearly 64M SF in the third quarter is helping tenants hold on to negotiating leverage.
Despite a growing occupier preference for new properties, the strong performance of Investcorp’s less-amenitized portfolio left room for the asset manager to grow in the segment.
“We continue to see robust tenant demand amidst fewer new deliveries,” Herb Myers, global head of real assets at Investcorp, said in a statement. “We will continue to capitalize on opportunities to invest in industrial assets that have similar characteristics.”
Investcorp has roughly $60B in assets under management across three continents and five business lines: private equity, real assets, credit management, absolute return investments and strategic capital. It had $11.4B in real estate assets at the end of June, including a U.S. real estate portfolio that is almost exclusively invested in industrial and residential properties.
The firm says it raised $7B for private equity and real estate in 2025 through September, including a $1B dry powder fund. It has deployed $4B across all asset types this year while cutting $180M in leverage.
Industrial operators have largely weathered profound shifts to trade and immigration policy in 2025. Prologis, the globe’s largest warehouse owner, increased its year-end forecast in July after beating analyst projections and posting 9% growth in funds from operations for the second quarter.
Pandemic-era development was focused on sprawling distribution centers, offering options for tenants looking for huge footprints. But smaller operators are struggling to find more modestly sized spaces to fit their increasingly regionalized operations.
Private capital is looking to capitalize on the dislocation. The Carlyle Group announced in August that it was closing its 10th real estate fund with $9B raised and a focus on industrial and residential assets.
