Monomoy REIT's $1B Growth Ambition and Strategic Partnerships with Kennedy Lewis: Leveraging Alternative Assets for Real Estate Expansion in a Post-Pandemic Market

In the wake of pandemic-driven economic shifts, the real estate market has seen a seismic realignment of priorities. Industrial real estate, in particular, has emerged as a linchpin of growth, driven by the relentless expansion of e-commerce and the need for resilient logistics infrastructure. Against this backdrop, Monomoy Properties REIT, a key subsidiary of Great Elm Group (NASDAQ: GEG), has unveiled an ambitious $1 billion growth plan, anchored by a strategic partnership with Kennedy Lewis Investment Management (KLIM). This collaboration not only underscores the growing importance of alternative assets in real estate but also highlights how institutional capital and operational expertise can catalyze expansion in a fragmented market.

The KLIM Partnership: Capital, Control, and Catalyst

According to a report by GlobeNewswire, KLIM has committed up to $150 million to Monomoy REIT, a private real estate investment trust focused on industrial outdoor storage (IOS) properties [2]. This investment includes an initial $100 million term loan, with an option for an additional $50 million, alongside a 4.9% stake in Great Elm Group’s common stock at $2.11 per share [4]. Crucially, KLIM also secured a 15% profits interest in Great Elm Real Estate Ventures, a newly formed entity that consolidates Monomoy’s real estate subsidiaries, including Monomoy CRE, Monomoy Construction Services, and Monomoy BTS [2].

This partnership is more than a capital infusion—it’s a structural repositioning. By consolidating operations under Great Elm Real Estate Ventures, Great Elm Group aims to streamline its industrial platform, enabling Monomoy Construction Services to scale its project pipeline by over 50% [5]. The capital will also refinance existing convertible debt and fund new acquisitions, reducing leverage while accelerating growth. As stated by Sahm Capital, KLIM’s appointment of board representatives to both Great Elm and Monomoy REIT signals a long-term strategic commitment, blending institutional oversight with operational agility [4].

Alternative Assets as a Growth Engine

The partnership’s focus on alternative assets—specifically industrial storage and equipment finance—aligns with broader market trends. Industrial REITs have outperformed peers in 2025, with Prologis reporting a 53.7% increase in net effective rent, driven by e-commerce demand [2]. Monomoy’s niche in IOS properties, which include secure, climate-controlled storage facilities for industrial goods, taps into this demand while offering a differentiated asset class with stable cash flows.

Equally significant is Great Elm’s foray into equipment finance. In July 2025, the company partnered with Utica Leaseco to launch Great Elm Utica, LLC, a joint venture targeting the equipment finance sector [1]. This move capitalizes on the 3.1% growth in equipment finance new business volume in 2024, as reported by the Equipment Leasing and Finance Association [1]. By diversifying into equipment leasing, Great Elm is positioning itself to benefit from the broader alternative asset boom, which includes project financing and structured credit solutions.

Market Dynamics and Strategic Implications

The post-pandemic real estate landscape remains fragmented. While industrial and residential REITs thrive, office REITs struggle with remote work trends, and retail REITs face uneven demand [2]. Monomoy’s strategy, however, is to exploit the structural tailwinds of industrial real estate and equipment finance. Data from ICR Inc. shows that REITs as a whole posted a 2.3% year-over-year net operating income (NOI) growth in Q1 2025, with industrial REITs outpacing inflation [3]. This resilience is critical for Monomoy’s $1B target, as it validates the sector’s ability to generate consistent returns even in a high-interest-rate environment.

Moreover, the partnership with KLIM introduces a layer of financial flexibility. With the 10-year Treasury yield projected between 3.5% and 4.0% in 2025 [1], refinancing existing debt at favorable rates becomes a strategic advantage. This allows Monomoy to deploy capital more efficiently, whether through acquiring distressed assets in mature markets or expanding into high-growth regions.

Conclusion: A Blueprint for Alternative Asset-Driven Growth

Monomoy REIT’s partnership with Kennedy Lewis exemplifies how strategic alliances can unlock value in a post-pandemic real estate market. By leveraging KLIM’s capital and expertise, Great Elm Group is not only accelerating its industrial platform but also diversifying into alternative assets that align with macroeconomic trends. As the REIT market grows by USD 350.2 billion through 2028 [2], Monomoy’s focus on industrial storage and equipment finance positions it to capture a significant share of this expansion. For investors, the key takeaway is clear: in an era of market fragmentation, alternative assets and strategic partnerships are no longer optional—they’re essential.

**Source:[1] Equipment Finance Industry Sees 3.1% Growth in New Business Volume Amid Tightening Credit in 2024, [https://www.elfaonline.org/news-and-publications/industry-news/read/2025/08/04/equipment-finance-industry-sees-3.1--growth-in-new-business-volume-amid-tightening-credit-in-2024][2] Great Elm Group Announces Strategic Partnership with Kennedy Lewis Investment Management, [https://www.globenewswire.com/news-release/2025/07/31/3125404/0/en/Great-Elm-Group-Announces-Strategic-Partnership-with-Kennedy-Lewis-Investment-Management.html][3] REIT Performance Holds Strong Amid Market Uncertainty, [https://www.credaily.com/briefs/reit-performance-holds-strong-amid-market-uncertainty/][4] Kennedy Lewis Invests $150M In Monomoy REIT, Acquires 4.9% Stake In Great Elm Group To Accelerate Industrial Real Estate Growth, [https://www.sahmcapital.com/news/content/kennedy-lewis-invests-150m-in-monomoy-reit-acquires-49-stake-in-great-elm-group-to-accelerate-industrial-real-estate-growth-2025-07-31][5] Great Elm Group's Q4 2025: Contradictions Emerge on [https://www.ainvest.com/news/great-elm-group-q4-2025-contradictions-emerge-real-estate-integration-investment-strategy-platform-expansion-growth-plans-2509/]