Sterling Organization, a vertically integrated private equity real estate firm whose national platform is focused on investing in LAST HOUR® consumer fulfillment and distribution real estate assets, has announced the final closing of its first Sterling Logistics Properties Fund, Sterling Consumer Logistics Properties I, LP (“SCLP I”). The Fund received total capital commitments of $225 million, which were raised from a diverse institutional investor base including endowments and public pension funds.
SCLP I seeks to opportunistically acquire primarily vacant, freestanding retail buildings with the intent to convert them into Neighborhood Fulfillment Centers. The properties are intended to be leased to third-party logistics providers, e-commerce retailers, traditional retailers, and direct-to-consumer manufacturers for the purpose of distribution of consumer goods to solve the “last mile,” or more accurately the LAST HOUR®, delivery dilemma related to both cost and time.
“We can’t begin to express how humbled and extremely grateful we are to have the confidence and support of such well-respected institutional investors in our first Logistics Fund offering,” said Adam Munder, Principal of Sterling Organization. “We are confident that our investment strategy, combined with the strong team we have assembled, should enable us to take advantage of current market conditions via this unique product offering,” added Mr. Munder.
“We all witnessed as shipping and fulfillment became the major battleground for retailers looking to earn, service, and retain customers during the height of the pandemic. What became crystal clear was that all retailers need to focus not only on how quickly a customer can get to a physical store, but how quickly the desired product can get to the customer’s home in an economical manner,” said Joe Dykstra, President of Sterling Logistics Properties. “As customers demand same-day deliveries – and perhaps within an hour or on demand, all retailers, traditional and digitally native, will have no choice but to lever Neighborhood Fulfillment Centers to compete successfully. We at Sterling Logistics Properties are committed to remaining at the forefront of this evolution from a real estate perspective,” added Mr. Dykstra.
“Sterling Logistics Properties was born out of the unprecedented and dynamic acceleration of the online delivery demand for all consumer products, brought on by Covid-19 lockdown. Bringing a real estate solution to life that tackles cost and timing issues facing all retailers as they enact their LAST HOUR® delivery strategy while earning the trust of many institutional LPs that enables us to execute on our strategy is incredibly gratifying. We are committed to executing on the highest level for those partners that have believed in us and our vision for the future of the retail omnichannel experience,” said Brian Kosoy, Managing Principal and CEO of Sterling Organization.
Sterling Organization owns 74 properties throughout the U.S., exceeding 12.5 million square feet of gross leasable area and over $2.7 billion in value. The SCLP I Fund currently owns six properties totaling approximately 451,000 square feet of gross leasable area in markets like New York, Los Angeles, Seattle, San Francisco, Chicago, and Phoenix.