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KKR to Build Warehouses as Demand for Space Outstrips Supply

With vacancies tightening, the private equity giant is working on eight developments in U.S. Sun Belt cities.

Demand for warehouse space in the U.S. is outpacing the available supply.

Demand for warehouse space in the U.S. is outpacing the available supply.

Source: Getty Images

KKR & Co. has turned to building warehouses after being a big buyer of the properties, as demand for space to store, distribute and manufacture goods continues to outstrip supply.

The private equity giant’s real estate unit has started its first-ever ground-up industrial developments, with eight projects underway in Atlanta, Dallas, Denver and Orlando, Florida. The properties -- midsized warehouses for last-mile deliveries and other logistics needs -- will add 1.8 million square feet (170,000 square meters) to KKR’s current 45 million-square-foot industrial portfolio.