The new fund will target $300 million in equity commitments, and $850 million in buying power. It will invest in the acquisition, improvement and respositioning of multi-tenant light industrial and small and mid-bay industrial warehouses.
According to BKM, this is in line with the fund manager’s strategy of investing in distressed assets that can be renovated and re-tenanted to increase value.
BKM closed its debut fund in February 2016, having raised $105 million in fund equity and $30 million in co-investment equity.
Brian Malliet, CEO and co-founder of BKM Capital Partners, said: “There is a disconnect in the market in our niche asset class that has allowed us to consistently acquire these properties at a significant discount to replacement cost and peak pricing.”
He added: “We have a deep pipeline of opportunities, which is why we have more than doubled our target equity goal for Fund II.”
Nima Taghavi, executive chairman of BKM Capital Partners, said: “The key to our platform’s success is our specific focus on multi-tenant light industrial assets, a strict underwriting discipline with a meaningful amount of margin of safety in all of our assumptions and an intensely hands on approach with our asset management and property management.”
Currently, BKM’s portfolio consists of 18 properties in Seattle, Phoenix, Las Vegas, and California.