Sidra Capital launched US$155 Million Industrial Aggregation Fund


As per a statement released, Jeddah-backed Sidra Capital on Wednesday announced launching of their initial US-based single tenant leased industrial real estate aggregation program. The fund was subscribed within three weeks from launch, and would be having an investment worth approximately $155 million, in the acquisition of industrial properties in the US.

This deal, will be empowering and boosting the firm’s real estate acquisitions strategy in the US, wherein deal volume has bettered $1.2 billion as of the third quarter of 2021.

Hani Baothman, Chairman of Sidra Capital, noted out that, “The fund embodies Sidra’s strategy of investing in industrial real estate and represents the company’s first real estate aggregation strategy. Industrial, warehouse and logistical real estate continue to generate strong demand.”

It also added out that, “Despite the near-term impact of the pandemic on the commercial real estate (CRE) sector, we are witnessing continued growth in the U.S. industrial sector, and to take advantage of this, we have utilized our proven asset sourcing ability to create a portfolio that we believe will generate an attractive cash on cash return with significant additional value created by aggregating the individual properties into a single portfolio.”

As per the firm’s reports, overall credibility of US industrial real estate sector can be assessed from its sheer size. The US industrial real estate market was assessed at $1.5 trillion in 2018, which is equal to about 7% of the US GDP.

As per the firm’s reports, overall industrial real estate space square meter totalled approximately 2 billion, accounting for about 30% of total US commercial real estate space. The inbound investments in the US industrial real estate increased from $6.3 billion in 2019 to $8.5 billion in 2020, recording a robust 35% year-on-year growth.

The fund also displays as the firm’s initial real estate aggregation strategy.

As per the firm’s reports, it revealed out that, there is huge surging demand for industrial real estate for several years, motivated by the emergence of two main structural drivers – the acceleration of e-commerce adoption and the requirement for better inventory as supply chains highlight resilience over efficiency.

As an outcome, the requirement for warehouse, distribution space is anticipated to upsurge in the future, resultant in higher rents, lower vacancy rates. The reopening of the US economy is advancing demand for warehouse and logistics facilities, as showed by growing preleasing rates, which upsurged to 61.3% in Q2 2021 from 34.6% last year. As per recent reports, Industrial rent is anticipated to increase in the range of 4% to 7% in 2021 and 2022.

Sidra Capital is creating space for the investment via their Heartland industrial aggregation fund. The firm presently owns 40 industrial properties strategically positioned in metropolitan areas across the US. The new fund boosts Sidra Capital’s real estate acquisitions strategy in the United States, where deal volume has bettered $1.2 billion dollars as of Q3 2021.

Press Release received on mail from Sidra Capital


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