Carlyle teams up with Montano in new German urban logistics JV

Global investment firm Carlyle and Munich-based Montano Real Estate are teaming up in a joint partnership to invest in logistics properties, focused on distribution assets in prime German urban locations.

As part of the deal, Montano will take control of the asset management of Carlyle’s existing 12 distribution logistics properties across Germany, which were acquired by Carlyle through European Carlyle Europe Realty (CER), a €540 million pan-European real estate fund. Montano will work together with Carlyle to further grow the portfolio on behalf of a discretionary fund managed by CER.

The focus is primarily on upgrading, refurbishing and where necessary, repositioning logistics assets in German cities with strong demographic and economic fundamentals, with the goal being to boost the portfolio to €500m over the coming years.

Erik Orbach, Director on the Carlyle Europe Realty advisory team, said: “Germany represents one of Europe’s most established and attractive logistics markets with strong demand fundamentals and a shortage of high-quality modern logistics assets.

Montano Real Estate recently rebranded itself from its earlier Montano Asset Management and embarking on a new expansion including offering its own investment products.

As the two Montano founders and managing partners Ramin Rabeian and Sebastian Schöberl put it, the goal is to increase the company's assets under management to €6-8 billion by 2025, from today's €1.6bn. The assets total about 536,000 sqm, made up of 80% office and 20% retail space.

In the first half of 2021, Montano transacted a volume of about €800 million, which it says keeps it on track for its ambitious target.

Real Estate private equity group TTL AG now holds a 50% stake in Montano, up from 30% at the end of 2020, which should provide additional firepower, and help it to take on more risk, which it will be doing by offering its own products to its institutional partners. TTL AG also owns a minority stake in listed DIC Asset AG.