Alpha Industrial to double its warehouse portfolio to 700,000 sqm

German industrial property developer and investor Alpha Industrial plans to double its own very sizeable logistics portfolio from currently 350,000 sqm to 700,000 sqm, while raising its rental income and giving itself greater protection from the vagaries of the capital markets, the company said recently.

Alpha Industrial ranks in the top ten German industrial project developers, according to the BulwienGesa rankings. It plans new projects of 96,500 sqm this year. At the top of the list of developers in the sector are Panattoni Europe with 231,500 sqm this year, followed by VGP with 205,000 sqm and Goodman with 196,500 sqm.

Since its founding in 2007 Alpha Industrial has developed more than 500,000 sqm of logistical, industrial and commercial space at an investment volume of more than €550m. With its own landbank the company could develop up to 750,000 sqm of new space, according to founder and partner Jörg Schroder. The company has secured large brownfield sites in Ost-Westfalen, Saarland and in the Ruhr area, where it could build a mix of logistics and commercial property, with about 70% of the land convertible from previous industrial uses.

As part of its rapid expansion plans, the company recently bought a commercial asset in Vienna on a sale and leaseback transaction from pharma logistics group Schachinger, with a view to upgrading the 60,000 sqm property to adapt it for city deliveries. It has partnered up in Austria with Tristan Capital Partner as a co-investor and asset manager to boost rental income and become more independent of the capital markets, it said in a recent statement.

Earlier this month Alpha Industrial bought a 28,500 sqm property with value-add potential in Böblingen, near to Stuttgart, of which 17,500 is warehouse space, fully leased. The seller was Matrix GmbH of Nufringen.

According to Anette Lurz, Head of Asset Management at the company, "Our aim is to double our asset portfolio in the medium term. As an investor, project developer and asset manager, Alpha Industrial is interested in properties with value-add potential in conurbations," commented

The company employs 25 and focuses on three business divisions – investment, project development and asset management, in the latter for which it manages 1.2 million sqm across 25 different locations mainly for international investors, generating about €65m in annual rental income. Schröder said it plans to increase this to 2 million sqm in the next couple of years.

The company started in 2007 with the construction of the €44m global warehouse for DAX-30 company Fresenius Medical Care, one of the biggest projects of its size in Europe and the biggest in Germany. It speedily adopted an outsourcing model of logistics contracting for the pharmaceutical industry, owrking closely with companies such as Grieshabe Logistics and Logosys. It established a distribution warehouse for TJX Europe in 2010, enabling the rapid expansion of clothing chain TK Maxx throughout Germany and the continent.

“Over the last ten years, Alpha Industrial has played a decisive role in shaping several trends in the logistics and manufacturing sector, such as upmarket pharma logistics properties, extensive brownfield developments and asset management that specialises in this asset class,” said managing director Ulrich Wörner, who is also responsible for the project development division since the company's foundation.