Leitbox Storage Partners
For most of the last cycle, a sponsor could raise capital on a track record and a thesis. Investors committed to a pooled vehicle, trusted the manager to find the deals, and waited to learn what they owned. That bargain, the blind pool bargain, is quietly ending for everyone except a handful of the largest managers. The capital has not disappeared. It has become far more selective about who gets to invest it, and on what terms.
The Numbers Behind the Shift
The clearest evidence is in the fundraising data. Nontraded REIT fundraising through common shares totaled roughly 4.4 billion dollars in the first nine months of 2025, according to Robert A. Stanger and Co. That is down from the 33 to 34 billion dollar range these vehicles raised in both 2021 and 2022. A decline of that magnitude is not a rough quarter. It is a repricing of trust.
At the same time, the capital that is still moving has clustered at the top. Stanger data showed Blackstone alone commanding more than 30 percent of market share in both the nontraded REIT and nontraded BDC segments in 2024, with Blackstone and Blue Owl together accounting for close to half of nontraded BDC fundraising. Across the broader retail alternatives channel, the leading fundraisers were a short list of familiar names, including Blackstone, Blue Owl, Ares, Apollo, and KKR. Below that tier, the room got very quiet.
Why the Giants Still Raise Blind
The largest managers can still ask investors to commit before they see the assets, and it works. Brand, scale, and the perception of durability carry weight, particularly with advisors who need to defend an allocation to clients and investment committees. As one industry executive noted, a big name is simply easier for a broker dealer or RIA to get behind. Scale also buys diversification and the machinery to manage redemptions at size, which matters enormously in a stressed market. This is a flight to size, and it is rational.
What Broke the Bargain for Everyone Else
Two things changed. First, higher rates raised the cost of blind trust. When safe assets pay next to nothing, committing to a manager’s discretion is easy. When they pay more, every basis point of uncertainty has to be justified. Second, and more painfully, the redemption episodes that began in 2022 showed investors what a continuous, pooled, redeem on request structure can do under stress.
As requests accelerated, the largest NAV REIT in the market saw redemptions run near 3 billion dollars per quarter beginning in the third quarter of 2022, and the manager worked through roughly 35 billion dollars of redemption requests over the following four years, according to Stanger and CoStar reporting. Sponsors met those requests by limiting repurchases to a set percentage of net asset value each quarter, exactly as the structures were designed to do. Stanger has since flagged that a similar redemption cycle may now be starting in nontraded BDCs. Investors absorbed the message. A liquidity promise from a pooled vehicle is only as good as the quarter you try to use it.
The Move Toward Specified Assets
The reaction has been a migration toward structures where the investor can see what they own. Delaware Statutory Trust offerings, which hold identified properties rather than a blind pool, raised roughly 5.7 billion dollars in the first nine months of 2025, more than nontraded REIT equity fundraising over the same stretch, and were on pace to clear 7 billion dollars for the year. The tell is that the largest managers are following the capital. Blackstone itself has moved to launch a specified asset DST program and lower fee institutional share classes, broadening beyond the perpetual pooled model it helped popularize. When the biggest blind pool sponsor in the market starts selling specified assets, the direction of travel is not subtle.
Where Leitbox Fits
This is the environment Leitbox Storage Partners was built for. The larger a fund grows, the blinder the investor becomes. So Leitbox stays deliberately small, niche, and nimble, running an identifiable pipeline of roughly a dozen deals per fund that investors can actually see. Size here is not a constraint; it is the alignment. A large fund that must exit into a difficult rate environment can quietly turn into a long-term aggregation vehicle, collecting asset management fees while investors stay stuck. Leitbox seeks out the tough, complex deals that others pass on, returns capital as it exits rather than holding to build assets under management, and has historically turned projects over quickly by remaining transaction oriented. The average hold period has run barely three years, and many projects have sold at certificate of occupancy within about twelve months, which limits duration risk by design. That discipline has been recognized by institutional investors, including a multi-investment venture partner that ranks among the largest capital allocators in the world, an arrangement that lets Leitbox share the general partner promote with its limited partner investors. The result is alignment all the way through: the right strategy for these times, the right size for today’s investor concerns, and execution acknowledged by some of the most demanding investors in the world. Self storage suits this specified model especially well. As Leitbox’s current portfolio demonstrates, it carries low operating overhead and a diversified tenant base, and it lends itself to the short holds that return cash to investors. They can underwrite exactly what they are buying, and now is the time.
“We were built for alignment, not for scale. The right strategy for this market, the right size for what investors are worried about today, and execution proven by some of the most demanding investors in the world. For managers outside the top few, that is what it takes now. And the timing has never been better.”
Bill Leitner, Managing Principal, Leitbox Storage Partners
The Verdict
The blind pool era is not over. For Blackstone, Apollo, Ares, and a few others, it may never end. But for everyone else, the market has issued a clear verdict. Blind faith is no longer a fundraising strategy. Transparency, alignment, and a defined path to liquidity are. The sponsors who understand that are already competing on it. Leitbox intends to keep doing storage differently.
About Leitbox Storage Partners
Leitbox Storage Partners develops and acquires self storage, often with mixed use and retail integration, in primary and secondary markets throughout the United States. Using its proprietary site selection technology, Leitbox identifies supply and demand imbalances and executes a defined business plan for each market. The firm “Does Storage Differently.”
Sources
• Robert A. Stanger and Co. fundraising data, via WealthManagement.com and AltsWire (2024 to 2025).
• CoStar News, Blackstone REIT DST and share class launch, November 2025.
• Blue Vault, Nontraded BDC fundraising and asset levels, Q3 2025.
• Robert A. Stanger and Co., commentary on the BDC redemption cycle.
