As growing demand for industrial outdoor storage space has driven more institutional capital sources into the sector, a pair of financing deals this week show just how big that interest has become.

Fortress Investment Group completed two refinancing agreements totaling $708M for IOS portfolios, it announced in a press release. Deutsche Bank led the refinancing deals, which consist of a $493M first-of-its-kind single-asset, single-borrower CMBS loan and a $215M balance sheet loan.

"Our SASB transaction, and the pricing transparency that it provides, affirms that IOS assets are treated very similarly to traditional industrial buildings from a capital markets perspective," Fortress Global Head of Real Estate Tom Pulley said in a statement.

The CMBS loan is backed by 41 properties on the West Coast — 32 in California, eight in Seattle and one in Portland. The portfolio consists of 1.9M SF of space across 142 acres of land.

That portfolio's appraised value is approximately $740M. The properties are all within 25 miles of a port, and roughly 75% of them are within one mile of the nearest highway.

Fortress has acquired nearly 120 assets in the U.S. and Europe, targeting Southern California, Seattle and the Netherlands. The firm had $48B in assets under management as of Dec. 31.

IOS properties have seen rising demand coming out of the pandemic and still have relatively low supply. This deal is the latest example of growing investor interest in the sector that some experts predicted would come this year.