What is the target IRR range for logistics/industrial asset classes?

The target Internal Rate of Return (IRR) for logistics or industrial asset classes typically falls within the 7-10% range. This is due to several factors associated with the market dynamics of logistics and industrial properties.

Logistics and industrial investments are often seen as having stable cash flows, largely owing to the rising demand for e-commerce and distribution centers, which have been significant trends in recent years. Investors in this sector are looking for reasonable returns that reflect the moderate risk associated with such assets.

The 7-10% IRR target is attractive because it strikes a balance between the yield expectations of investors and the relatively stable nature of the cash flows generated from these properties. This range also aligns well with the financial models used by institutional investors who are cautious of taking on higher risks for marginally increased returns.

In contrast, the other ranges stated might indicate a higher risk profile, which does not accurately represent the logistics/industrial sector, where the emphasis is on stable, long-term investments rather than speculative high returns.