Bridging the Institutional Ownership Gap in Industrial Real Estate

While industrial real estate has long been a cornerstone of the economy, there is a notable gap within this sector in institutional ownership — such as pension funds, endowments, foundations and sovereign wealth funds. As an experienced operator, Basis Industrial can serve as a valuable partner for investors looking to enter the industrial real estate market. With our footprint spanning U.S. regions from Florida to New York, from Boston to Arizona, from Texas to Pennsylvania and various urban hubs in between, we recognize both the opportunities and challenges inherent in this gap. Here is a closer look:

  1. Untapped Potential: Despite the strong growth of the industrial real estate market, institutional ownership lags behind other asset classes such as office and retail. This offers a remarkable opportunity for savvy investors to capitalize on the untapped potential of industrial properties.
  2. Diversification Benefits: Industrial real estate offers unique diversification benefits, with low correlation to other asset classes such as stocks and bonds. By merging industrial properties into their portfolios, institutional investors can improve their diversification and have the opportunity to reduce overall portfolio risk.
  3. Challenges of Scale: One of the main challenges facing institutional investors in industrial real estate is the required scale of investment. Industrial properties often require large capital outlays, making it difficult for smaller investors to participate.
  • Operational Expertise: To effectively manage industrial properties, it is essential to have specialized operational expertise, including knowledge of supply chain dynamics, tenant relations, and property maintenance. Institutional investors must work or partner with experienced operators to successfully navigate this industry.
  • Market Fragmentation: The industrial real estate market is very fragmented and has many submarkets and property types. This can present challenges for institutional investors who wish to efficiently deploy capital and achieve economies of scale.
  • Rising Demand: The rapid growth of e-commerce and logistics has fueled increased demand for industrial real estate assets, highlighting potential opportunities for institutional ownership. As consumer behavior changes, so does the demand for well-located industrial properties.
  • Strategic Partnerships: Collaborations between institutional investors and experienced operators such as Basis Industrial offer potential for great success in bridging the ownership gap. By leveraging the operational expertise of partners, institutional investors can enjoy the benefits of industrial real estate while utilizing these partners to tackle potential challenges.

At Basis Industrial, we understand the complexities and nuances of the industrial real estate market. Through strategic partnerships and a commitment to excellence, we strive to unlock the full potential of industrial real estate portfolios for institutional investors. To learn more about how we can help you navigate this dynamic market, visit basisindustrial.com or reach out to info@basisindustrial.com today.

About Basis Industrial

Basis Industrial is a vertically integrated real estate owner and operator formed by industry veterans and sponsors Jay Massirman, Stephen Garchik and Daniel Weinstein. Basis brought Anthony Scavo on as COO/President to run day-to-day activities of the company. Together they have over 100 years of combined Real Estate Development and Management experience. It has deep roots in the self-storage and industrial sectors. Basis currently owns over 4 million square feet of self-storage and industrial real estate and is scheduled to close and/or complete another 2 million square feet in 2024. Active markets for Basis include Florida, Pennsylvania, New Jersey, New York, Texas, Boston, Los Angeles, Alabama and select urban markets nationwide. In total, the sponsors have developed and managed over 15 million square feet of real estate assets including self-storage, industrial, retail, office and residential. BaySpace is the property management arm of Basis. In 2023, Basis Industrial was ranked the No. 1 fastest-growing company by South Florida Business Journal. In 2024, Basis was the winner of Commercial Observer’s Breakthrough Awards in the Industrial Transaction of the Year category. For more information, visit www.basisindustrial.com or www.bayspace.com.