BKM Capital Partners and Kayne Anderson Real Estate Acquire Bay Area Industrial Portfolio

Transaction Involves Over a Half-Million Square Feet of Multi-Tenant Infill Space Across 16 Buildings

Hayward and Concord, CA — July 22, 2025 — BKM Capital Partners, a vertically integrated institutional fund manager specializing in multi-tenant light industrial real estate, alongside Kayne Anderson Real Estate, the real estate investment arm of Kayne Anderson, have acquired a three-property portfolio in the San Francisco Bay Area. The transaction marks a significant expansion of the joint venture’s footprint in the East Bay and North Contra Costa County, two of the region’s most supply-constrained submarkets.

Totaling approximately 505,000 square feet across 16 buildings and 94 units, the portfolio comprises institutional-quality, light industrial space situated on 34 acres of infill land with exceptional access to regional transportation, major population centers, and a deep, skilled labor pool. The properties were marketed by CBRE National Partners.

“Functional, well-located light industrial product of this scale rarely trades in the Bay Area, so this was a rare opportunity to secure critical mass in two of the most supply-constrained industrial submarkets on the West Coast,” said Brett Turner, Senior Managing Director of Acquisitions & Dispositions at BKM. “The portfolio offers a compelling combination of functionality, tenant diversity, and mark-to-market upside in a region where scale is incredibly difficult to achieve. It’s exactly the kind of opportunity we’re purpose-built to execute on.”

The portfolio is 89% leased to a roster of over 70 tenants with no single industry comprising more than 20% of the rent roll. Unit sizes average just over 5,300 square feet, offering high leasing flexibility and catering to a broad mix of regional and national users. The three assets include Huntwood Business Center, totaling 176,056 square feet across three buildings, and the 82,562-square-foot, three-building Hesperian Business Park, both in Hayward, CA; and Concord Industrial Park, with 245,930 square feet across 10 buildings in Concord, CA. The Concord property will be renamed Mount Diablo Industrial Park as part of BKM’s broader repositioning plan.

Built between 1980 and 1988, the portfolio presents a significant near-term income growth opportunity, with approximately 28% of in-place rents below market and a weighted average lease term of just two years. Lease rollovers are staggered, offering stable near-term cash flow alongside the ability to reconstitute the rent roll at higher market rates.

The joint venture will leverage BKM’s fully integrated regional platform to oversee leasing and operations. This deal echoes BKM’s success executing on earlier phases of a broader institutional sell-off of similar Bay Area assets—more than four million square feet of which the firm has already repositioned. This, alongside BKM’s boots-on-the-ground operating platform and broker relationships, played a key role in both identifying and unlocking this opportunity.

“This acquisition exemplifies our ability to uncover and execute on complex, operationally intensive assets where institutional capital is often less competitive,” said Brian Malliet, Founder, CEO, and CIO of BKM Capital Partners. “We’ve built a platform that thrives on these kinds of challenges—where value creation depends not just on capital, but on local knowledge and relationships, hands-on execution, and an ability to deliver what today’s tenants actually need.”

The Bay Area remains one of the most supply-constrained industrial markets in the country. In the East Bay and Contra Costa County, vacancy for small-bay space is trending below 3%, with virtually no new construction of sub-100,000-square-foot product due to land scarcity, zoning barriers, and escalating development costs.

Hayward sits at the center of the I-880 corridor—known as the “Hardware Side” of the Bay—home to more than 900 hardware and manufacturing companies supporting Silicon Valley’s broader tech ecosystem. The area has experienced strong rent growth, near-zero new deliveries, and sustained tenant migration from both Oakland and San Jose. Concord, meanwhile, serves San Francisco’s affluent eastern suburbs and benefits from its proximity to major refineries, key infrastructure, and the future $6-billion redevelopment of the Concord Naval Weapons Station, which is expected to bring 12,270 new homes and six million square feet of mixed-use development to the area over the next 40 years.

With limited new supply, rising replacement costs, and strong economic anchors in both markets, the portfolio is well-positioned to generate durable income and long-term value.