A real estate investment company launched a $250 million fund targeting Southeast U.S. industrial properties amid a surge in domestic manufacturing demand.
Boca Raton-based IP Capital Partners’ IPCP Southeast Industrial Fund II targets $1 billion in purchases across Florida, Georgia, Tennessee, and North and South Carolina, seizing on 150,000-square-foot to 300,000-square-foot properties in the $15 million to $50 million range, according to a news release and IP Capital President Jason Isaacson.
“This is a small and nimble income and growth fund,” Isaacson said. A “large institutional fund is too big to buy these mid-market type sizes, which ironically to us is the sweet spot of demand. By being small and nimble, it allows us to take advantage of these institutional blind spots.”
IPCP Southeast Industrial Fund II’s seed round raised $37 million, surpassing its $25 million goal. It’s targeting July 1 for its next close, aiming to raise the remainder of the funding.
The fund, which is live on global fintech platform iCapital, will be capped at $300 million, the release says.
It will target properties with five- to eight-year lease terms, generally with the goal of holding until leases roll over, increasing rents if the market allows it and then selling, Isaacson said.
SEIF II is eyeing properties across supply-chain logistics, including manufacturing facilities, bulk distribution centers, cold storage warehouses and last-mile distribution centers.
“The supply chain is being decentralized and because of that, it needs smaller, more nimble warehouses. The proliferation of demand for spaces is concentrated in smaller bulk formats,” Isaacson said.
More warehouses closer to consumers reduces the hefty transportation and labor costs for distributors. Real estate is one of the cheapest elements of the supply chain, “with transportation being one of the most expensive,” Isaacson said.
Part of the fund’s bet is that domestic production will continue surging, at least in part due to the Trump administration’s tariff policies and the “One Big Beautiful Bill” signed last year.
IP Capital found that many tenants want to take control by bringing production to the U.S. in a bid to avoid future supply-chain bottlenecks reminiscent of those during the pandemic and, more recently, the tariffs, Isaacson said. The U.S. also incentivizes domestic production by allowing businesses to write off their investment in plant equipment.
Examples of the push to bring production to the U.S. have popped up, including in IP Capital’s portfolio. In a sale-leaseback deal, SEIF I invested in a Nashville facility where the tenant relocated its tire repair equipment manufacturing from Shanghai.
IP Capital also will joint venture on fund investments and will operate and manage the fund, eliminating double fees for investors.
The firm doesn’t have a specific target for South Florida industrial investments.
Its previous investment vehicles included IPCP Florida Realty Value Fund IV, which is more of an opportunistic value-add fund, and Southeast Industrial Fund I.
The latter fund raised about $150 million, making roughly $400 million in purchases for nearly 4 million square feet, Isaacson said. Last year, Southeast Industrial Fund I paid $25.7 million for a 77,600-square-foot cold storage facility near Miami International Airport.
