Tishman Speyer, Mitsui Fudosan debut $500M industrial JV

Logistics venture to target markets with tight supply

Tishman Speyer's Andy Burke and 17 William Drive (Tishman Speyer)
Tishman Speyer's Andy Burke and 17 William Drive (Tishman Speyer)

Tishman Speyer and Mitsui Fudosan America are embarking on a significant joint venture in the industrial real estate sector.

The developers announced the partnership on Tuesday, described as focused on the acquisition, development, redevelopment and operation of industrial properties. The venture is being seeded by a $500 million commitment from the two companies, to be used to pursue ground-up projects and reposition acquisitions.

The venture will primarily target major cities on the coasts, including Los Angeles, New York City and the Bay Area, along with some inland targets in cities like Austin and Chicago. The two companies have worked together before; Mitsui has co-invested in Tishman office, residential and life sciences developments.

Tishman has been ramping up its activity in the industrial sector. The developer late last year teamed with Hana Financial Group and Vestas Investment Management to acquire two industrial assets in Pittsburgh and Colorado Springs. Tishman launched an industrial platform to manage the properties.

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Since then, Tishman — mainly known for office and residential properties — has demonstrated belief in the industrial market. The company this year hired former Prologis executive Andy Burke to head the industrial team.

The joint venture comes as the sector’s pandemic hot streak has recently appeared to be cooling. Nearly 150 million square feet of warehouse space hit the market in the third quarter, but demand is waning as the e-commerce boom fades and recession fears rise.

The Northeast industrial market is still breaking records. Tenants and owners have occupied a net of 44.5 million square feet in the region so far this year, the most in the market’s history, according to JLL.