IIndustrial outdoor storage (IOS) has shifted from overlooked mom-and-pop truck yards into one of the most profitable, highly competitive sectors in commercial real estate—consistently outperforming traditional core asset classes.
In this episode of Adding Value, host Shy Assar sits down with Benji Miller, founder of Negresco Property Group. Benji shares how he transitioned from working on massive institutional portfolios to launching his own firm and teaming up with Bethesda-based Open Industrial to deploy programmatic capital across Southern California.
We dive straight into our recently closed transaction at 10905 Hemlock Avenue in Fontana, CA—a $4,800,000 all-cash acquisition ($50/LSF) on 2.20 acres featuring a ±10,000 SF building and verified by-right truck and trailer storage.
In this episode, we cover:
• The 10905 Hemlock Breakdown: Sourcing, front-end due diligence, and navigating Fontana’s strict zoning landscape.
• The 1–3 Acre Sweet Spot: Why smaller low-coverage parcels provide the highest leasing velocity versus chasing "white whale" 10-acre sites.
• Acquisition Criteria: Why sub-30% coverage, functional service facilities, and dual-street ingress/egress are non-negotiable for institutional IOS.
• Structuring Co-GP & Equity Partnerships: How emerging sponsors scale by leveraging balance sheets, LP equity, and patient capital.
• Capital Markets & IOS Maturation: Debt conditions, cap rate expectations (fives to high sixes), and how 1031 buyers view IOS today.
• Advice for Brokers & Sponsors: The "unicorn" skill set of raising equity vs. finding deals, and how brokers can win institutional business.
Timestamps:
00:00:00 - Preview: Sponsorship Rules & Finding Alpha in Small Deals
00:01:09 - The Rise of Industrial Outdoor Storage (IOS)
00:02:02 - Breaking Down 10905 Hemlock Ave ($4.8M Fontana Acquisition)
00:03:38 - How the Deal Came Together: Sourcing & 2-Decade Trucking History
00:05:40 - The 1–3 Acre Sweet Spot vs. Chasing "White Whales"
00:07:20 - Negresco’s Co-GP Partnership with Open Industrial
00:08:44 - De-risking Due Diligence Upfront with Land-Use Counsel (Allen Matkins)
00:11:04 - The Value-Add Business Plan & CapEx Playbook for Hemlock
00:12:56 - Aggregating "Golden Tickets": Flexible Capital & WALT Strategy
00:14:10 - Why Institutional Equity Is Chasing Niche Alternative Assets
00:18:09 - Benji's Pivot: From $700M Hackman Deals to Entrepreneurship
00:20:26 - The True Cost of Starting a Firm & Balancing Family
00:24:44 - A Note for Inland Empire Industrial Owners
00:25:13 - How Co-GP Equity Stacks & GP Co-Invest Splits Work
00:28:42 - The Sub-30% Coverage Rule & Functional Shop Space
00:31:46 - Municipal Moats: Why Cities Don't Want More Truck Yards
00:32:50 - Acquisition Target Range ($3M to $50M+)
00:33:49 - IOS Portfolio Exit Strategies, Recaps & Maturing Loans
00:36:14 - SoCal Cap Rates & 1031 Exchange Buyers in IOS
00:37:51 - How Long-Term Relationships Turn into Closed Transactions
00:40:46 - Advice for Next-Gen Sponsors: The Sponsor Rule of Survival
00:44:06 - What Top Brokers Must Do to Win Institutional IOS Business
00:47:03 - Closing Thoughts
Connect with Shy Assar:
Voit Real Estate Services: https://voitco.com
Email: SAssar@voitco.com
Follow on YouTube: @AddingValueShyAssar
Watch the full episode here: https://www.youtube.com/watch?v=7qT_5Pw0cTo
#IndustrialOutdoorStorage #IOS #CommercialRealEstate #IndustrialRealEstate #Fontana #InlandEmpire #AddingValue #creative