BKM Capital Closes $2.8B in Small-Bay Industrial Deals, Exceeding 2026 Target

The Newport Beach firm has acquired 72 assets this year and expects to reach $3 billion across 79 properties by year-end despite rising rates.

By the Family Office Real Estate Daily Desk·Monday, October 26, 2026·2 min read

Editorial summary of reporting byBisnow Our editorial standards →

The answer · checked against Bisnow

How much has BKM Capital Partners invested in small-bay industrial real estate in 2026 and what is their outlook for the rest of the year?

BKM Capital Partners has closed $2.8B across 72 small-bay industrial assets in 2026, surpassing its original $2.3B annual target, according to newly promoted CIO Brett Turner. The Newport Beach firm now expects to reach $3B across 79 properties by year-end, partnering primarily with Kayne Anderson Real Estate, despite rising borrowing costs and 10-year Treasury yields exceeding 5%.

Key facts

BKM Capital Partners has acquired 72 small-bay industrial assets for $2.8B in 2026, surpassing its original $2.3B target for the year, according to CIO Brett Turner.
BKM Capital Partners expects to close $3B across 79 assets by year-end 2026, Turner told Bisnow in a videoconference interview.
BKM Capital Partners' largest single transaction was a $1.8B purchase from Link Logistics of a 90%-occupied, 8.5M SF portfolio of 51 multitenant industrial properties across California, Washington, Texas and Georgia.
BKM Capital Partners has approximately $200M in acquisitions totaling 900K SF under escrow at the time of the interview, according to Turner.
Mid-bay industrial completions have declined 70% since their peak in late 2023, according to a BKM white paper citing second-quarter CoStar data.
BKM Capital Partners hedges 100% of its debt and Turner said ongoing deals have not fallen through nor has BKM asked sellers to lower prices on deals in progress.

BKM Capital Closes $2.8B in Small-Bay Industrial Deals, Exceeding 2026 Target — Image: editorial illustration · Story sourced from Bisnow

BKM Capital Partners has acquired $2.8 billion worth of small-bay industrial assets across 72 properties so far this year, exceeding its original $2.3 billion target for 2026, chief investment officer Brett Turner said in an interview with Bisnow this month. The Newport Beach, California-based firm expects to close on $3 billion across 79 assets by year-end, Turner said.

The firm's largest deal was a $1.8 billion purchase from Link Logistics for a 90 percent occupied, 8.5 million square foot portfolio of 51 multitenant industrial properties across California, Washington, Texas and Georgia. That transaction launched BKM's buying spree in February. Between 75 percent and 80 percent of the firm's deals are sourced off market, Turner said.

BKM has been targeting the Southeast, Texas and California. From September through October, the firm spent $174 million on three Florida industrial acquisitions. Those included a 210,000 square foot multitenant business complex and a 61,000 square foot small-bay industrial property in Fort Lauderdale, along with a 545,000 square foot light industrial portfolio in Central Florida.

The firm has worked largely in tandem with Kayne Anderson Real Estate, a 42-year-old private equity real estate investor with $41 billion in assets under management. BKM was founded by chief executive Brian Malliet in 2013 with two employees as an institutional fund manager and operator of small-bay light industrial assets. The company now has more than 200 employees and $8.1 billion in assets under management across more than 235 assets, according to its website.

Mid-bay industrial completions have declined 70 percent since their peak in late 2023, according to a BKM white paper citing second-quarter data from CoStar. The lack of available supply is giving investors like BKM the confidence to close on acquisitions even though the Federal Reserve hiked rates for the first time since 2023 and yields on 10-year Treasury bonds shot past 5 percent from below 4 percent in the course of six months.

The volume that looks sustainable in a rising-rate environment almost never is once the headline rate peaks, family office advisor Jaf Glazer has cautioned.

Turner said BKM has seen very little impact on assets the company already owns because it hedges 100 percent of its debt. The firm has not asked sellers to lower prices for deals in the works, and Turner said he has not seen any ongoing deals fall through. BKM plans to invest millions in upgrades to the exteriors, roofs and HVAC systems of the buildings it is buying, he said.

The bet on small-bay warehouses comes as the broader industrial sector adjusts to a historic construction wave. Big-box warehouses are driving a 19 percent uptick in construction even amid relatively flat vacancy and rents, according to a third-quarter national Colliers report. Smaller industrial properties that serve local and regional businesses needing space for storage or light production are largely undersupplied, Turner said.

The Deployment Angle

Family Office Real Estate Daily Desk · our analysis, not the source's

The small-bay industrial thesis rests on a 70 percent decline in mid-bay completions since late 2023 against sticky tenant demand from local and regional businesses. That supply constraint is the headline underwrite. The counterweight is execution in a debt market where the 10-year Treasury crossed 5 percent in six months and oil prices hit April highs. BKM's full debt hedge insulates its existing portfolio but does not eliminate financing risk on new acquisitions if rates climb further or if lenders pull capacity.

BKM's pace — 72 deals in eleven months, 75 to 80 percent sourced off market — argues for a co-general-partner or separate-account route alongside an established operator rather than a programmatic blind pool. The firm is deploying with Kayne Anderson Real Estate, which manages $41 billion and offers institutional-grade governance. A family office writing an eight- or nine-figure check into BKM's next vehicle gets exposure to deal flow that is demonstrably off-market and to a team that has closed $2.8 billion this year without re-trading sellers.

The $1.8 billion Link Logistics transaction was 90 percent occupied across 8.5 million square feet in California, Washington, Texas and Georgia. If that portfolio priced at a blended 5.5 percent going-in cap rate — a reasonable assumption for stabilized small-bay industrial in those markets — net operating income would be roughly $99 million, implying an equity check of approximately $900 million at 50 percent leverage. A family office considering a similar profile should underwrite to a 6 percent exit cap in five years and stress-test the cost of capital if the 10-year holds above 4.5 percent through the hold period.

Avoid blind bets on small-bay industrial as a category play. The 19 percent uptick in big-box construction and flat vacancy across the broader industrial market mean that any small-bay thesis must be granular by submarket and tenant mix. Price in the cost of the capital improvements BKM is embedding — exterior, roof and HVAC upgrades across 72 properties — and assume those budgets will overrun if construction costs reflate. The counterparty risk on off-market deals sourced through broker relationships is harder to diligence than auction processes, so co-investment alongside a sponsor with BKM's volume and reputation is the lower-risk path.

Questions this story answers

01How much has BKM Capital Partners spent on industrial acquisitions in 2026 and how does that compare to their target?

BKM Capital Partners has spent $2.8B on 72 assets in 2026, surpassing its original $2.3B annual target, according to CIO Brett Turner. The firm expects to reach $3B across 79 properties by year-end.

02Who is BKM Capital Partners working with to fund its industrial buying spree?

BKM Capital Partners has largely worked in tandem with Kayne Anderson Real Estate, a 42-year-old private equity real estate investor with $41B in assets under management, to expand its industrial footprint in 2026, according to the source.

03How is BKM Capital Partners handling rising interest rates and debt market volatility?

BKM Capital Partners hedges 100% of its debt, and CIO Brett Turner said the firm has seen very little impact on assets it already owns as a result. Turner also said BKM has not asked sellers to lower prices on deals already in progress, citing the firm's reputation for deal volume.

04What markets and property types is BKM Capital Partners targeting for acquisitions?

BKM Capital Partners is primarily targeting small-bay light industrial assets in the Southeast, Texas and California, according to CIO Brett Turner. Between 75% and 80% of its deals are sourced off market, Turner said.

05Why are investors willing to pay a premium for small-bay industrial properties right now?

Tampa-based Lee & Associates industrial broker Jackson O'Neill said investors are aggressively underwriting small-bay industrial because they believe rents will continue to grow. Longpoint Partners partner Tom Stipanov said tenant demand in the sector drives outperformance and NOI growth independent of capital market conditions.

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