Niche assets are driven by factors like demographic change, affordable housing challenges as well as changes in technology and consumer behavior. Savvy investors blend their portfolios with niche assets, like Cold Storage, and traditional property types.
Cold storage is being fueled by growing urban populations, the proliferation of consumer demand for fresh food, e-groceries and fulfilment. The sector is also in a consolidation phase, both in the U.S. and globally. The vast majority of existing inventory is owned by either user/owners or by third party logistic providers.
Investors should consider:
- Accumulating cold storage portfolios by collecting individual assets. With consolidations and institutions seeking scale, portfolios are likely to attract premium valuations.
- Proactively approaching both owner/occupiers and 3PLs about potential sale-leaseback transactions that would free capital for further expansion