By Mark Heschmeyer
Targets $300 Million in Equity Commitments for $850 Million in Buying Power
BKM Capital Partners, an institutional fund manager with a niche focus on value-add, multi-tenant light industrial and warehouse properties, launched its second institutional fund, BKM Industrial Value Fund II.
The fund is targeting $300 million in equity commitments, delivering $850 million in buying power.
The fund, which will invest in industrial business parks in markets across the Western U.S., comes on the heels of the closing of BKM’s debut fund, for which the firm raised more than $105 million in fund equity and $30 million in co-investment equity for a total of $135 million.
BKM targets distressed real estate that can be renovated, repositioned, and re-tenanted to drive maximum value.
“There is a disconnect in the market in our niche asset class that has allowed us to consistently acquire these properties at a significant discount to replacement cost and peak pricing,” said Brian Malliet, CEO and co-founder of BKM Capital. “We have a deep pipeline of opportunities, which is why we have more than doubled our target equity goal for Fund II.”
BKM Capital Partners has already closed more than $340 million in transactions, recently bringing its first three Fund I assets full cycle, achieving IRRs above 38% on each asset and multiples ranging from 2.0-2.5, according to the company.
BKM’s current portfolio encompasses 18 properties in four states including assets in Las Vegas, Seattle, Oregon and Phoenix, among others.
BKM Capital Partners, which has offices in Seattle, Phoenix, Las Vegas and California, recently relocated its headquarters from Irvine to Newport Beach.