Aaron Halfacre, President and CEO Modiv Industrial, Inc., (NYSE:MDV), was a guest on the latest episode of Nareit’s REIT Report podcast.
Halfacre discussed Modiv’s evolution toward focusing on industrial manufacturing facilities, after starting out as a diversified net lease REIT.
“We found that industrial manufacturing facilities, like ours, were flying a little under the radar and also, like us, were offering very attractive upside potential to investors. The manufacturing sector has strong fundamentals, solid cap rates, healthy contractual rent buoyancy, long-term reliable leases and a somewhat inefficient transaction market. All of this made it clear to us that we were onto something,” Halfacre said.
Over the past 24 months, Modive has acquired over $200 million in industrial manufacturing assets, while completing the sale of large amounts of non-core assets.
Meanwhile, Halfacre said the United States is benefiting from pronounced investment in manufacturing. The restocking movement is bringing previously imported goods and manufacturing jobs back to American shores, he said, and that effort is expected to continue over the next decade. “This is a really exciting time for manufacturing,” he said.
With a focus on existing mission-critical manufacturing sites focused on the production of infrastructure-based products, “we have the opportunity to scale Modiv into a very large REIT from several high-quality existing facilities already operating within the US today.” There are vast opportunities. We see a lot of opportunities to drive growth and enhance shareholder value,” Halfacre said.
