Dear Value-Focused Investors,
The real money is quietly piling up in the least sexy asset class imaginable: Industrial Outdoor Storage. Yes, folks, we’re talking about the thrilling world of parking lots and storage yards. Try not to get too excited.
Alterra IOS just secured a whopping $343 million loan commitment from Truist and the Bank of Montreal. For those keeping score at home, this brings Alterra’s total financing commitments across their IOS funds to over $1.5 billion. That’s billion with a ‘B’, as in “Boy, that’s a lot of gravel.”
Now, before we all rush to break ground on our own premium parking empires, let’s break this down:
- Big Money, Bigger Picture: $343 million is no chump change. It’s the kind of commitment that says, “We believe in the long-term value of large, flat surfaces.” And they’re not wrong. While everyone else is chasing the next unicorn, IOS investors are riding a slow, steady, and delightfully boring wave of appreciation.
- Institutional Backing: Truist and Bank of Montreal aren’t exactly known for their wild, speculative bets. When institutions of this caliber open their vaults, it’s time to pay attention. They’ve done the math, and apparently, the numbers add up.
- Market Momentum: With over $1.5 billion in financing commitments, Alterra isn’t just dipping its toes in the IOS waters—it’s doing a cannonball. This level of investment suggests a market that’s not just growing, but accelerating.
But here’s the million-dollar question (or in this case, the $343 million question): Is this a sign of a market peak, or are we still in the early innings?
My take? The IOS market is far from overheated. Here’s why:
- E-commerce isn’t slowing down, and those packages need somewhere to sit.
- Urban infill opportunities are becoming scarcer, making well-located IOS assets more valuable.
- IOS offers flexibility that traditional industrial can’t match, especially in a rapidly changing logistics landscape.
Bottom line: While the rest of the market is chasing shiny objects, smart money is betting on dirt. Alterra’s move is a clear signal that there’s still plenty of runway in the IOS sector.
Remember, folks: In a world obsessed with the next big thing, sometimes the best investment is the one that’s been under our noses (and our tires) all along.
Stay grounded!