Industrial & Logistics

Properties leased to FedEx, Amazon, DHL, and other tier-one logistics providers offer exposure to essential infrastructure supporting the modern supply chain. These facilities-ranging from large fulfillment centers to last-mile distribution hubs-benefit from consistent demand and limited new supply constraints in prime markets. Tenants in this space maintain investment-grade or near-investment-grade credit ratings and demonstrate financial resilience through multiple economic cycles. The sector's characteristics include long lease terms (10-15 years), creditworthy operators, and favorable rent escalation provisions. The Boulder Group's Q2 2026 median asking cap for industrial single-tenant net lease is 7.25%. That print reflects both the quality of tenants and the returns investors are seeking in this asset class.

1. 1Focus on supply-constrained markets with limited developable land where tenant occupancy costs are justified by operational efficiency and delivery speed requirements.
2. 2Seek properties leased to tier-one operators (Amazon, FedEx, DHL) with BBB- or better credit ratings, as these tenants drive sector fundamentals and maintain robust financial profiles.
3. 3Evaluate lease structures for CPI escalations or fixed annual increases; logistics rent growth typically outpaces inflation, providing strong total return potential.
4. 4Consider the property's technological compatibility with modern logistics standards (ceiling height, column spacing, loading capacity) as these features justify premium rents and support renewal viability.
5. 5Monitor supply metrics in target markets; properties in markets with absorption rates below vacancy and positive net absorption (>2 million SF annually) offer superior appreciation potential.
6. 6Assess tenant expansion plans and whether the property is strategically positioned for long-term renewal at higher rates as supply tightens and alternatives become scarcer.