Strategy
“A vision without a strategy remains an illusion.” – Lee Bolman
Put Simply
Founders Grove Capital is aggressively seeking partners and opportunities to acquire Class B industrial assets between 10,000 and 100,000 square feet from central Texas to Florida.
We’re developing deal opportunities featuring exceptional, risk-adjusted assets in high-growth markets with a focus on value-add opportunities.
THE DETAILS
What
Simply put, we are targeting the purchase of sub institutional industrial buildings where we can add value. The most ideal property type? Class B. Think single tenant, small bay, light industrial and/or outdoor storage.
Often, the most ideal properties that fit our strategic investment goals present themselves at 10,000 to 100,0000 square feet. We then look for opportunities in those buildings to make capital and operational improvements.
Where
Pull out a map and following Interstate 10 (I-10) from central Texas to Florida. That’s our target geography, which also happens to be a main transportation artery, the southernmost transcontinental highway and the fourth-longest Interstate in the United States (coming in at 2,460.34 miles to be exact).
Now.
Sign up here to receive our regular newsletters and be among the first to know of the deal opportunities available.
Why
Prior to niching down into Class B Industrial Real Estate, we were focused on the acquisition of multi-family properties in DFW. That space, though, quickly grew crowded, which meant it got more and more expensive and harder to bring a strong return to our partners.
We pivoted and looked for a fragmented market where we could apply a roll-up approach.
In this particular niche of real estate, our research has found that roughly 50% of industrial buildings under 100,000 square feet are owned by owner operators or local
investors. How does that translate into impact on our strategy? There is a higher likelihood of finding buildings to acquire that are mismanaged with below market rents
that can be repositioned to create a more valuable asset.
Another thing about this asset class? Over the last 10 years or so, thanks to the explosion of e-commerce, most construction in industrial real estate has been large institutional investments between 200,000 and 1 million square feet (or more). For properties of our targeted size – the 10,000 to 100,000 square feet – there is an unmet demand in the market (meaning lots of tenants competing for fewer spaces).
There’s many other reasons we love Class B. In fact, there’s 10 of them. Read on here for more.
End Game
You know the phrase, "start with the end in mind?" We do, too. And with that in mind, we’re aiming to build a portfolio of 20-25 of industrial properties into a single portfolio valued north of $50 million to ultimately attract an institutional buyer for a portfolio exit.