BKM Capital Partners Buys Seattle-Area Industrial Properties

BKM Capital Partners is increasing its holdings in the Puget Sound region.

The Newport Beach, California-based industrial real estate investment firm acquired a five-building portfolio in Kent and Tukwila for $85.7 million, the Puget Sound Business Journal reported. Blackstone’s Link Logistics was the seller. The portfolio’s combined assessed value is roughly $77 million, according to King County records cited by the Business Journal.

The portfolio spans 413,840 square feet across two business parks in the suburban cities for a per-square-foot price of $207. Three of the five buildings are in the Southcenter West Business Park on the 1100 block of Andover Park West in Tukwila. The buildings sold there total 300,000, with the largest of the three spanning 107,660 square feet. The buildings last sold in 2015 for $30.2 million.

The other two buildings are at 22640 and 22647 West Valley Highway South in the Upland Corporate Park in Kent. They total 114,500 square feet and last traded in 2012 for $4.3 million and 2017 for $8.2 million.

BKM’s five-building buy comes a month after the firm spent upwards of $90 million on another multi-building purchase in Kent. BKM spent $93.6 million for four buildings at the 212th Business Park in Kent in a joint acquisition with Kayne Anderson Real Estate. The purchase was part of a $1.8 billion portfolio deal where BKM and Kayne acquired 51 industrial properties and eight Link Logistics offices in Washington, California, Texas and Georgia. BKM and Kayne Anderson launched a joint venture last year committed to spending $1.5 billion on industrial real estate across the country.

BKM’s latest Puget Sound acquisitions come as the local industrial market is leveling out after years of record demand. Industrial vacancy rates in the region rose from 2.9 percent in late 2021 to 10.3 percent earlier this year as leasing activity is eclipsed by new supply.

— Chris Malone Méndez