Real Estate Investments
Small-Bay
Light Industrial
Our Investment Strategy
Our value-add investment strategy targets multi-tenant small-bay industrial properties with the opportunity to improve value through strategic renovations, hands-on management, adaptive repositioning, and rebranding in markets with strong economic growth.
Our vertically integrated platform includes in-house capabilities to reposition existing assets, enhance property management, drive leasing results, and institutionalize light industrial properties.
We believe there is an opportunity to institutionalize this niche asset class that has been traditionally fragmented and historically overlooked by investors and institutional tenants alike.
Driving Factors
Strong Demand Trends
Demand for small-bay industrial assets has significantly increased as entrepreneurial businesses gain momentum. These businesses prefer the shorter lease terms and flexible spaces offered by this asset class.
Limited New Supply
Overall supply is limited both by lack of new construction due to high land and construction cost and by geographical constraints. This combination presents favorable opportunities for skilled owner-operators of multi-tenant industrial assets.
Value-add Opportunities
This type of asset presents many opportunities to add value through repositioning and provide investment returns not dependent on market conditions.
Diversified Tenant Base
Tenants come from a wide range of industries, limiting property owners' exposure to secular downturns in any one area.
Exceptional Rent Growth
Leases come up for renewal more frequently allowing for faster rent appreciation and swifter adjustment for inflation.
Fragmented Ownership
Many small-bay industrial properties are owned by individuals who lack the knowledge, capital or skillset to operate them optimally.
Our Investment
Process
We follow a disciplined real estate investment approach identifying opportunities with significant upside potential and controllable downside protection.
Acquisition Criteria
1
Acquire
- Source properties that present a value-add opportunity.
- Leverage broker & owner relationships to acquire off-market assets.
- Data-driven and disciplined underwriting approach.
2
Improve
- Improve & rebrand the building exterior.
- Standardized interior improvements to reduce costs.
- Increase operational efficiency and tenant satisfaction.
3
Reposition
- Implement a targeted marketing plan to increase market presence.
- Aggressively market rents to market and convert leases to NNN.
- Reposition to attract a diverse and quality tenant base.
4
Increase NOI
- As leases roll, increase rents and WALT.
- Increase profitability and maximize returns by streamlining processes & utilizing technology.
- Distribute cash flow until the opportune time to exit.
5
Exit
- Aggregate assets for an institutional exit.
- Options to dispose of a single property or portfolio.
- Improved assets are positioned to be priced at a lower cap rate.
Fully Integrated Platform
Asset
Management
Management
Real Estate Brokerage
Property Management
Construction Management
Industry-Leading Technology
Case Studies
Clearwater, FL
Acquisition Date
July 2021
Renovation cost
$665,000
Stabilization
12 months
- Collektion executed a comprehensive improvement plan that included a modernized paint scheme, roof replacement, new gutters, metal replacement & repairs, bollards, seal coat and restripe the parking lot, new signage, and landscaping.
- Renovated 10 units to standardized interior design and paint scheme.
- Systematically roll below-market rents, increasing in-place rents by 80% at stabilization.
- Converted all leases to NNN with 4-5% annual escalation.
- Implemented processes and systems to increase operational efficiencies and tenant satisfaction.
Melbourne, FL
Acquisition Date
March 2022
Renovation cost
$545,000
Stabilization
12 months
- Within 2 months of acquisition, Collektion vacated all 13 units and fully renovated each unit to our standardized interior design and paint scheme.
- Collektion executed a comprehensive improvement plan that included a modernized paint scheme, roof replacement, new gutters, metal replacement & repairs, parking lot repairs, bollards, signage, and landscaping.
- Implemented processes and systems to increase operational efficiencies and tenant satisfaction.
- Backfilled vacancies with high-quality tenants at market rents with 4-5% annual escalation.
- Increased NOI by 300% since acquisition.
Our Tenants
Owners. Brokers. Investors
Connect with us to discuss the sale of an asset or how you can partner or invest with Collektion Capital.
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Get In Touch
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