Standard, GCM Grosvenor Launch $150M Industrial Venture

Robert Jue, CEO, Standard Real Estate Investments. Image courtesy of Standard Real Estate Investments

Standard Real Estate Investments LP has launched a new investment venture with funds managed by GCM Grosvenor.

Over the next 12 to 18 months, the venture will target equity investments in about $150 million of industrial property developments in markets across the U.S.

The industrial user demand side remains strong but the capital markets remain challenging for sponsors, creating a financing gap that the new program can help fill, Standard CEO Robert Jue said in a prepared statement.

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The Standard/GCM Grosvenor venture is targeting three to four transactions, with a preference for shovel-ready warehouse/logistics properties of about 200,000 to 500,000 square feet in major logistics markets nationwide.

The mismatch between strong demand from businesses at both ends of the supply chain on one hand, and limited liquidity on the other, will enable the new venture to step in and support quality projects with strong sponsorship, commented Lindsay Louie, a principal at Standard, in prepared remarks.

Versatility in action

Standard is a national allocator of development capital, headed by a leadership team that has invested in more than $8 billion of assets. The company also operates a direct development business covering the Mid-Atlantic region.

Lindsay Louie, Principal, Standard Real Estate Investments. Image courtesy of Standard Real Estate Investments

Last October, Standard acquired the Senator Square and East River Park shopping centers in northeastern Washington, D.C., with plans to redevelop the 13-acre site as a $650 million mixed-use development including 1,500 residential units and 120,000 square feet of community retail space. As part of the master plan, Trammell Crow Co. is developing a 257,000-square-foot build-to-suit office building for the District of Columbia Department of General Services there.

This year, U.S. industrial leasing activity is expected to moderate as occupiers pause expansion plans and as the peak-pandemic need to hold extra inventory dissipates, according to CBRE’s U.S. Real Estate Market Outlook 2023. Despite this leasing slowdown, however, “demand will keep up with supply in 2023, with a 13th consecutive year of positive net absorption, a near record-low vacancy rate and solid rent growth.”