The Ins And Outs Of Financing Industrial Outdoor Storage: Learn More At Bisnow’s Aug. 14 Webinar

The industrial outdoor storage market has been gaining popularity, capturing the eye of investors who seek an asset that can offer consistent income and high returns. Before getting involved in IOS, however, investors should ensure they learn about the ins and outs of the sector — including how to overcome environmental issues and navigate zoning rules.

Justin Horowitz, debt and equity broker at commercial real estate financing company Cooper Horowitz, said that investors can get ahead of potential obstacles by keeping in contact with their leasing broker and underwriting deals correctly.

“You may see a piece of land on the side of the highway and it may not have proper zoning, so the opportunity becomes dead on arrival,” Horowitz said. “You also have to make sure that there are tenants who want to be in the market you’re targeting.”

Investors can learn more about IOS financing and putting deals together at Bisnow’s Industrial Outdoor Storage Market Outlook webinar on Aug. 14. Horowitz will be moderating the Exploring the Dynamic Landscape panel.

Click here to register and buy tickets.

Horowitz spoke with Bisnow about the robust financing and equity market, considerations for investing in IOS and how Cooper Horowitz helps investors throughout the deal-making process.

Bisnow: What are some recent trends in the industrial outdoor storage market?

Horowitz: The financing market is still incredibly active and liquid. We have been closing on single-asset deals and portfolio loans with the likes of the banks, life companies and pension funds. There was recent news of a single commercial mortgage-backed securities deal that was done by Fortress for close to $500M, which opens up a new avenue for financing and shows a healthy CMBS market. The deal — which was completed on the CMBS market as a single-asset, single-borrower, or SASB, transaction — is impactful for the space, given that there's even more liquidity that wasn't originally there. On the financing side, that's incredibly appealing. 

The equity market is also extremely active. There are new people entering the market and a healthy amount of deals that are happening in which people are putting money toward buying properties. This still seems to be a great time for acquisitions, whether it’s along port or infill locations.

There are plenty of people in the market that you can point to and say that they’re actively deploying money into IOS. Institutionalization has been maturing more than it has over the past few years. 

Bisnow: What criteria are investors prioritizing in this market?  

Horowitz: Investors have to make sure that if they buy the property, it has the proper zoning and they can get the right tenants in. Once that part is set, they have to ensure the property is on a clean site. If remediation needs to be done, then it should be taken care of properly.

Investors should also consider the property’s location. If a trucking tenant is going to take the space, is it too far from the highway? Will it take too much time for the tenant to get to the interstate? Can trucks make the turn to get onto the property from the highway?

Bisnow: What are some of the ways in which Cooper Horowitz can help IOS clients through the deal-making process?

Horowitz: My team at Cooper Horowitz was one of the pioneers in the financing side of the IOS space. I'm extremely in tune with the lenders that have been active in IOS from the beginning, many of which we got into the space. My team is constantly getting inbound calls from new lenders saying, “We saw the deal you did,” and they want to be top of mind when we’re in the market next.

I'm in front of lenders daily with new deal flow, existing pipeline and deals that are in the closing process. Years ago, I had to explain what IOS is all about. Now they receive the presentation and that box is already checked. When I have a portfolio loan or individual loan, I have control of the deal and have a strong sponsorship. The lenders I approach trust my expertise, which means they can quickly move forward with underwriting.

My team is there through the whole process, from the marketing phase through the term-sheet negotiation, appraisal tours, loan negotiations and through closing. When I’m in the market on a deal, I give our clients daily updates about what's going on in the market from the lender standpoint and make sure I'm always available for them. 

I've done a tremendous amount of volume in IOS and have a lot of great clients. If someone comes to my team and says they're buying a property in Savannah, for example, we have experience, having done several deals out there. We know which lenders are engaging in IOS in Savannah and which aren’t. 

I am not going into the market and hoping I get a bid. I’m going to the market knowing I’m going to get bids because I’ve been doing just that for a long time. It’s a fun process.

Bisnow: What are you looking forward to most about speaking on Bisnow’s Exploring the Financial Dynamics panel?

Horowitz: I'm very excited and honored to moderate another panel for Bisnow. It’s not often you have some of the most active buyers in the same room — or, in this case, webinar — together. Our listeners are tuning in to something very special. 

It helps to have such great talent around me. I can’t wait to hear what Alex [Olshansky], Mark [Gannon], Rob [Logan], Trevor [Wright] and Trevor [Heaney] have to say about the IOS market and learn more about their strategies for staying competitive. It will also be nice for our listeners to hear their thoughts on 2025 and how they’re sourcing new deal flow in a competitive space.

Don’t miss out on the opportunity to register for Bisnow’s Aug. 14 Industrial Outdoor Storage Market Outlook webinar.

This article was produced in collaboration between Cooper Horowitz and Studio B. Bisnow news staff was not involved in the production of this content.