$985 Million Deal Transfers Stake in 87-Building U.S. Industrial Portfolio
Key Facts
GID and a subsidiary of StepStone Real Estate formed a joint venture and closed a manager-led secondary transaction valued at $985 million for an 8.0 million-square-foot industrial real estate portfolio, according to a statement published by Business Wire on October 26, 2026. The portfolio comprises 87 buildings across eight U.S. markets: Atlanta, Charlotte, Chicago, Dallas, Jacksonville, Portland, San Antonio and Seattle. The deal comes as a CBRE report showed increased absorption and leasing activity in the sector during the third quarter. The transaction transfers the investment to the joint venture while GID continues to manage the assets. The company said its accumulated knowledge of the buildings, their tenants and their markets gives it "a distinctive understanding of the portfolio."
GID has managed the portfolio since 2021 and will remain its asset manager on behalf of the joint venture, according to the statement. The president of GID Industrial said the company looks forward to continuing to create value through active management, drawing on its long-standing knowledge of the properties, tenants and markets in which it operates. StepStone linked its decision to partner with GID to its focus on industrial assets in urban markets facing structural supply constraints, as well as GID's expertise and asset management track record. StepStone said "structural supply constraints continue to support fundamentals." The statements place GID's continued management at the heart of the new arrangement, highlighting management and leasing as central to the period of joint ownership.
The deal came as demand for U.S. industrial space accelerated. Net absorption reached 104.6 million square feet in the third quarter, the highest quarterly total since the fourth quarter of 2022, exceeding the 10-quarter average of 82.9 million square feet, according to CBRE. That brought year-to-date absorption to 237.8 million square feet, compared with 97.7 million in the same period of 2025. Leasing activity also rose 27.1% year over year to 276.8 million square feet during the quarter. Year to date, leasing increased 17.9% to 842.3 million square feet, the report said.
Vacancy and availability indicators improved alongside demand growth: the vacancy rate fell 20 basis points year over year to 6.4% in the third quarter, while the availability rate declined 30 basis points to 8.9%, according to CBRE. The report attributed support for existing properties to the limited availability of first-generation space in some markets and increased lease renewal incentives. It also noted that vacancy remains a challenge in older properties. On the supply side, space under construction rose 9.3% year over year to 278 million square feet. Year-to-date deliveries totaled 182.7 million square feet, down 17% from the same period, reflecting a divergence between the volume of projects underway and the slowdown in deliveries.
The deal's backdrop is consistent with GID's long-standing activity in the sector: the company says it has operated in industrial real estate since 1986 and that its industrial portfolio exceeds 26 million square feet in major U.S. markets. That figure places the 8.0 million-square-foot portfolio covered by the transaction within a broader asset base managed by the company. In its sector outlook, CBRE forecast that annual industrial investment volume would rise 15% in 2026 to $130.7 billion, citing strong activity during the first three quarters. The average loan-to-value ratio was 60.5% in the third quarter, compared with 57.5% in the second quarter and 59.6% a year earlier. Average net asking rent also rose 3.6% year over year to $11.16 per square foot, while vacancy continued to weigh on pricing power in some markets.
Industrial companies' transactions offer another view of leasing conditions. First Industrial said cash rents on new and renewed leases rose 52% in the third quarter compared with prior leases, while occupancy at operating properties stood at 94.1% at quarter-end, versus 94.9% in the second quarter and 94.0% a year earlier. The company cited a strong pace of early renewals for leases expiring in 2027 and raised the midpoint of its 2026 same-store cash net operating income growth forecast to 6.5%, an increase of 75 basis points from its previous guidance. In August, StepStone closed its first infrastructure-focused secondary fund with $1.5 billion in capital commitments. The company said the fund had deployed about half its capital across 26 closed transactions through that month, in activity separate from the current real estate deal.
Markets are awaiting StepStone's second-quarter fiscal 2027 results on November 5, 2026, according to the company. CBRE expects annual industrial investment volume to reach $130.7 billion in 2026, up 15% from 2025, amid activity recorded during the first three quarters. Third-quarter figures reflect improved absorption and leasing and lower vacancy, alongside a large volume of space still under construction. This keeps future supply within the market context into which the portfolio is entering a joint venture. The statement did not give a date for subsequent operational changes to the assets, while GID confirmed it would continue to manage them.