From Fringe to Foundation: The Evolution of Industrial Real Estate
The latest episode of The Distribution is a masterclass in how an overlooked corner of real estate became one of the most institutionally accepted asset classes in the world.
The latest episode of The Distribution is a masterclass in how an overlooked corner of real estate became one of the most institutionally accepted asset classes in the world.
I sat down with Franz Colloredo-Mansfeld, CEO and Chairman of Cabot Properties, to unpack the journey—from the early days of low-profile warehouses to building a $12 billion global logistics platform.
“The industrial sector was only 5% of the overall REIT market, and the REIT market at that time was only about a hundred billion. So, it was a fringe sector of a fringe sector of the public markets.”
That was 1998.
Today, logistics is one of the top performers in both public and private markets—driven by durable fundamentals, demand from e-commerce, and a rethinking of global supply chains.
Franz doesn’t just tell the story—he lived it. From working for a Eurobond pioneer at Merrill Lynch to helping his father in a fragile, 15-person firm, to taking Cabot public and then private again… and then scaling it globally.
Here are the five biggest takeaways GPs can learn from his journey:
1. Public Isn’t Permanent—But the Lessons Are
When Cabot went public in 1998, Franz believed it was the path to growth, access, and scale.
“We went public, and the multiple at the time was 11 which is pretty darn low and then it went even lower. It went to 8.”
Public markets didn’t reward the thesis—at least not right away. But the experience changed the business.
“It took us into a different league. It opened up our horizons. It absolutely expanded our set of capabilities and our perspectives.”
Eventually, they sold the REIT and started over. But they didn’t abandon what they’d learned. They built on it.
Lesson for GPs: Just because one structure doesn’t work doesn’t mean the strategy is wrong. Don’t cling to a format—build the right platform for your thesis. And remember: the public vs. private trade-off is not about prestige. It’s about control, capital flexibility, and alignment.
2. Duration Creates Advantage
Logistics didn’t win because it was trendy. It won because it was patient.
“At the time, the sector was very fragmented. The big owners that we have today were so much smaller back then. And the institutional penetration was 10% or something.”
What Cabot saw wasn’t a short-term trade. It was a long-term opportunity to industrialize portfolios and capitalize on a generational shift in how goods moved.
They were early. And they were right.
“We raised our first fund and we sold the portfolio in ’05 to a REIT that was later bought by Prologis. So we were able to prove that thesis.”
Lesson for GPs: If you want institutional partners, you have to think in institutional timeframes. Duration—of strategy, of relationships, of value creation—is what separates the flashes from the franchises.
3. Culture Compounds. Leadership Sustains.
Franz built the firm as a partnership—and he’s still running it that way.
“We started as a partnership… and now we are opening up the partnership again. I have 15 partners. We’re broadening the base.”
That continuity has created staying power. The key is holding onto and maintaining culture throughout. The original team may have retired, but Cabot has held onto its culture—and passed it forward.
“We’ve been able to attract, particularly internationally… an exceptional group of people that might have done something else that was more interesting, like hotels or shopping centers. Now, logistics is actually in fashion.”
And that includes his son Seppi—who’s now joined the business.
“It’s great now being able to do that with my son.”
Lesson for GPs: Building a firm that lasts means focusing on leadership development just as much as deal sourcing. Culture isn’t something you just talk about, you have to live it. Every single day. Especially when the going is tough. Create incentives and exhibit behaviors that drive culture - it’s a capital multiplier.
4. Global Growth Starts with Local Insight
Cabot didn’t expand globally just to check a box—they went where the strategy made sense and found people who could help execute it.
“We were, for many years, the first 12 years of our business, we just were a group, a team in Boston… We now have 140 people distributed all over the world.”
They started in the UK post-GFC. Moved into the Netherlands, then Germany. Eventually launched offices in Sydney and Tokyo.
“We looked at the dynamic in the Netherlands… All those lease structures were linked to inflation. We were passing through 9% rental rate increases… it broke the log jam on rental rate increases.”
It wasn’t easy—but it was intentional.
“All those things that you just said, those impediments—they're real.”
Lesson for GPs: Global expansion works when you’re clear on your thesis, focused on premier markets, and humble about local complexity. It’s not about chasing flags or checking boxes. It’s about deep specialization and doing something that is differentiated.
5. Don’t Drift from What You Believe
Throughout the conversation, one theme stood out: discipline.
Cabot didn’t chase the latest trend. They doubled down on mid size logistics in infill locations. They stayed focused on liquidity, yield, and execution.
“We are a PE firm and we need to be very focused on liquidity and realizations. So we know where we want to invest.”
They didn’t build the largest firm. But they built one of the most respected.
“I like to say it’s the best chapter of our history so far.”
Lesson for GPs: Your core beliefs are your edge. Stay focused on what you know, scale with purpose, and lead with intention. Growth is only durable when it’s aligned.
Final Thought
The evolution of industrial real estate, and most business is a story of timing, discipline, and leadership. But more than that—it’s a story of conviction.
“We didn't invent logistics real estate—but we made it institutional.”
If you're a GP thinking about where you go from here—public vs. private, domestic vs. global, boutique vs. platform—this episode is worth your time.
🎧 Listen to the full conversation with Franz on The Distribution by Juniper Square.
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Let me know what stood out to you.
— Brandon