KKR Snaps Up Three-Building Portfolio In Phoenix


Global investment firm KKR & Co. (KKR) has acquired a three-building industrial portfolio in Phoenix from a joint venture between PCCP and Hopewell Development.

The acquired assets, totaling about 419,350 square feet, were constructed in 2020 and are within a 20- to 30- minute driving distance from the central business district in Phoenix.

The acquired buildings can house single as well as multiple tenants and have increased KKR’s total industrial real estate presence in the Phoenix market to almost 2.6 million square feet.

KKR Real Estate Group Director Ben Brudney said, “Phoenix has been one of the fastest-growing major markets in the U.S. over the past several years and we are very excited to add these high-quality assets which are complementary to our footprint in the market.” (See KKR & Co stock analysis on TipRanks)

Brudney added, “These newly built assets offer us the opportunity to take advantage of strong leasing momentum in the Phoenix market with near-term upside through the lease-up of the remaining vacancy.”

Significantly, KKR now owns about 36 million square feet of industrial property across the U.S. and manages $28 billion globally in real estate assets.

Last month, BMO Capital analyst James Fotheringham reiterated a Buy rating on the stock and increased the price target to $71 (28.3% upside potential) from $69.

Commenting after KKR’s investor day, Fotheringham noted the target EPS of $4-$5 by 2023-2024 implies over 30% revision at the midpoint.

Consensus among analysts is that KKR & Co is a Moderate Buy based on 8 Buys and 3 Holds. The average analyst price target of $64 implies 15.7% upside potential. Shares have gained about 93.7% over the past year.

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