BKM Capital, Kayne Anderson’s $1.5 Billion Industrial Pact

Investors BKM Capital Partners and Kayne Anderson Real Estate have linked up with a plan to buy $1.5 billion in light industrial buildings across the U.S.

The Newport Beach- and Florida-based investors formed a joint venture to commit the funds to acquire small- and mid-bay industrial properties, the Orange County Business Journal reported.

“This joint venture marks a transformative step for BKM,” Brian Malliet, founder and CEO of BKM Capital Partners, said in a statement. “We’ve spent over a decade building an operating platform designed explicitly for small-bay industrial, which is both operationally complex and highly fragmented.

“With Kayne Anderson’s support, we can now bring that model to scale across new markets with a partner who shares our long-term view.”

The joint venture would help BKM, which invested in properties across the Western United States, expand into infill markets across the country, according to the firm.

BKM hopes to double its platform to $5 billion of assets under management within the next 18 to 24 months, according to the Business Journal.

“Our joint venture with BKM allows us to invest in a sector that’s long been on our radar, alongside an operator that brings deep expertise and consistent access to opportunities,” Al Rabil, co-founder and CEO of Kayne Anderson Real Estate, said in a statement. “The sector’s tailwinds — driven by e-commerce, onshoring, and supply chain transformation — create a compelling long-term opportunity, and this partnership is uniquely positioned to capture it.”

In recent weeks, the JV already hit the ground running with a $550 million recapitalization of a nine-property, 2.1-million-square-foot portfolio in an unidentified location in the Western U.S., according to a news release.

The partnership has also bought five properties totaling more than 1.2 million square feet for an undisclosed price at unidentified locations in Las Vegas and Phoenix.

BKM, founded in 2013, has completed more than $4.5 billion in acquisitions involving 120 light industrial properties containing 23 million square feet, according to its website.

In January of last year, BKM Capital bought a 119,100-square-foot industrial and office complex in North San Jose for $30.7 million, or $258 per square foot.

Kayne Anderson Real Estate was co-founded by Rabil in 2007 as the real estate arm of Century City-based Kayne Anderson, which had $37 billion in assets under management as of Jan. 1, according to its website.

In January, an affiliate tied to Rabil, also the CEO of Kayne Anderson, bought a house in Palm Beach, Florida, for $17.6 million, next door to a 3.4-acre oceanfront estate he bought in 2017 for $49 million, according to The Real Deal.

— Dana Bartholomew