Chicago-based Brennan Investment Group has announced a corporate real estate initiative, under the Corporate Real Estate Solutions (CRES) brand. Under CRES, Brennan will help companies improve supply chain efficiency by purchasing surplus industrial real estate, providing customized build-to-suits and entering into both long- and short-term sale leasebacks.
“Corporations, not investors, own the majority of our nation’s industrial land and buildings,” said Michael Brennan, chairman and co-founder of Brennan Investment Group. “Further, more than at any time in history, supply chain designs are rapidly evolving with the goal of minimizing disruptions. Whether caused by port-of-call labor disputes, geopolitical uncertainties or supply disruptions from pandemics, corporate America has begun a supply chain reconfiguration process that will require a decade to complete. Brennan will offer its platform, its capital and its expertise to rebuild the backbone of our nation’s industrial infrastructure.”
Beyond geopolitics or pandemics, advances in technology have also accelerated supply chain reconfigurations. Brennan pointed out that the U.S. has lost much of its manufacturing base to countries with low labor costs, but automation—which has removed the comparative advantage in the e-commerce sector—will allow companies to repatriate manufacturing jobs back to U.S. shores.
A private real estate investment firm that acquires, develops, and operates industrial real estate facilities throughout the United States, Brennan has a nationwide portfolio of 44 million square feet. Brennan’s CRES initiative will continue to serve the traditional needs of corporations, including sale-leasebacks. Through its single-tenant net lease division, Brennan has acquired over 20 million square feet of mission critical buildings.
“The desire to be ‘asset light’ is a key driver,” said Robert Vanecko, managing principal and head of Brennan’s single-tenant net lease division. “This liberates new capital for our tenant and also increases the value of the tenant’s operating business. The presence of private equity firms purchasing operating companies has accelerated the ‘asset light’ operating model.”
CRES will undertake both single transactions and multi-property, multi-location portfolio acquisitions. The main criteria for the new CRES program are size—$3 million up to $500 million—and assets located in the top 100 MSAs. The new division will also seek out investment grade or non-investment grade distribution, manufacturing, light industrial and/or R&D properties through a variety of transaction types—surplus assets, long- and short-term sale leasebacks, build-to-suits, expansions, single assets or portfolios.
“Our CRES program is well suited for this environment,” said Scott McKibben, Brennan’s chief investment officer and managing principal. “Its broad reach can help both large and smaller corporations, in up to 100 MSAs, with an ability to undertake the simplest to the most complex transactions.”
