Small bay industrial is the hottest segment in commercial real estate right now. While big-box warehousing cools off, this niche is seeing resilient demand, constrained supply, and massive value-add potential. In this episode of Adding Value, I sit down with Brett Turner, Senior Managing Director of Acquisitions and Dispositions at BKM Capital Partners. Since helping found the firm in 2013, Brett has driven more than $6.5 billion in transactions across the U.S. and currently oversees a 35 million square foot portfolio.
00:00:00 Intro: Why Small Bay Industrial is outperforming Big Box.
00:01:45 The history of BKM Capital Partners and the thesis for light industrial. 00:03:43 Transitioning from private to institutional ownership in business parks.
00:04:32 Why vertical integration is a survival requirement in operations.
00:05:13 Scaling through technology: How BKM manages 4 leases per day.
00:07:31 Defining the asset: The difference between Multi-Tenant, Flex, and Split-Single product.
00:08:37 Industrial segmentation: Understanding the Small Bay niche (15,000 SF).
00:10:05 The "American Grit" tenant: Why small businesses are the ultimate credit.
00:12:21 Generational shifts: How Gen X and Gen Z are driving industrial demand.
00:14:41 The Value-Add Playbook: Identifying operational gaps and inefficiencies.
00:15:33 Driving 27% rent spreads through strategic capital improvements.
00:17:17 The Supply Story: Why land coverage ratios favor Small Bay growth.
00:18:43 Benchmarking performance: Capturing 10-12% annual rent growth.
00:19:16 Investment metrics: Ingoing cap rates and stabilized exit targets.
00:20:13 Case Study: Executing a 240-unit value-add acquisition in Las Vegas.
00:24:17 The institutional shift: Scaling from $25M to $200M+ transactions.
00:25:40 National expansion: Learning the dynamics of the Southeast markets.
00:28:44 "New Shoring" and the ripple effect of advanced manufacturing.
00:30:15 Closing: Shy Assar's early mentorship at BKM and the path to brokerage.
Whether you are an investor, developer, or industrial real estate broker in the Inland Empire, this conversation provides the "boots-on-the-ground" intel needed to navigate the 2026 market. Connect with Shy Assar: I am an industrial real estate broker at Voit Real Estate Services specializing in the Inland Empire. If you’re looking to reposition an asset or navigate the IE market, let’s add value to your portfolio. 🌐 Website: https://iebigboxadvisors.com 📩 Email: Sassar@voitco.com