Last week, the massive real estate firm Related made waves in the press with the first public opening of Hudson Yards, its $25 billion dollar development on the west side of Manhattan. But beyond these headlines, the company announced something much more interesting: its co-acquisition of Quiet Logistics, a leading fulfillment and logistics company for digitally-native brands, with Greenfield Partners, a real-estate investment management firm. Quiet works with over 60 digitally-native brands, including Away, Bonobos, Tuft & Needle and Outdoor Voices.

Related is one of the most sophisticated and vertically-integrated real estate companies out there. After purchasing Equinox in 2005, it invested heavily in the gym, transforming it into the worldwide luxury brand that it is today. Equinox then bought Soulcycle, which it also rapidly expanded, launched Blink Fitness, a more accessible offering, and invested in Rumble, a boxing startup. Related’s private investment firm, RSE Ventures, has also invested in companies such as Momofuku and Resy.

Most real estate developers lease space to tenants who are in charge of generating revenue from the space, without the landlord’s involvement. Sometimes developers get a cut of this revenue, as is common with percentage rent in retail real estate, but often times they do not. Related has a unique approach in that it focuses on acquisitions, allowing it to make more of every dollar earned on top of its real estate. It gives its acquired companies like Equinox and Soulcycle great property at unbeatable prices, which allows these tenants to improve their margins and pass those earnings back to Related.  

While acquisitions like Equinox allow Related to vertically-integrate “up the stack,” the Quiet Logistics acquisition is “down the stack.” Rising fulfillment costs are a major threat to digitally-native brands, second only to rising digital acquisition costs. As more brands launch, and many reject Amazon fulfillment services, mainly to avoid sharing their data with the ecommerce platform, independent logistics companies like Quiet have a lot of running room ahead of them. Quiet is also related to Amazon in another way: It previously used Kiva Robots in its warehouse, until Amazon bought the company, forcing Quiet to build its own solution, Locus Robotics. But as with Equinox when it gained access to Related’s resources, Quiet can expand faster and more cheaply, offering faster delivery in more cities. This will attract more brands to its services, which further spins the logistics company’s flywheel.

Related’s acquisition of Quiet also confirms that real estate developers are looking to digitally-native brands in order to fill their spaces with exciting upstarts. Hudson Yards actively courted these companies, and offering Related tenants a discount and/or preferred services from Quiet could help turn Related’s larger flywheel as well.

While many real estate developers concentrate on doing more with less, Related is focused on doing more with more. If past success is any indicator, the acquisition of Quiet Logistics, while less visible than a big, shiny real estate development, will have a substantial impact on its ecosystem. Even though most of Related’s marketing muscle has focused on the front end, it should be advertising its back-end investments with the same ferocity.