Gramercy’s third European logistics fund to focus on Germany

Gramercy Europe, the European investment fund manager focused on the pan-European logistics and industrial sector, will invest primarily in Germany for its third European logistics fund, its CEO Alistair Calvert told REFIRE at EXPO REAL in October.

‘Ideally, we’d like around 50% to be invested in Germany, 20% in France, 20% in the Netherlands and the rest in Spain,’ he said. ‘I expect our latest fund to be fully invested within the next 12 to 15 months and we are hopeful of closing deals in Germany, the Netherlands and Spain shortly.’

Gramercy announced in September that it had closed its third fund, Gramercy Property Europe III, with €260m of equity commitments. The fund will be leveraged up to 60%, providing total potential firepower of around €650m. The capital raising was achieved within two months and comes hot on the heels of the €1b disposal of Gramercy’s last fund in its entirety to AXA Investment Managers – Real Assets in July.

Gramercy Property Europe III will also invest in development projects, according to Calvert: ‘We will develop assets for this fund and can have 20% of our stabilised NAV under construction at any time. Around 20% to 30% of the fund will eventually be invested in build-to-suit development projects.’

The group has also addressed concerns on the part of investors wary of investing in the UK during the uncertainty playing out during stagnant Brexit talks: ‘A lot of LPs aren’t looking to invest in the UK at the moment so, as with this fund, it’s easier to exclude it,’ Calvert explained.

The fund manager will also undertake sale-and-leaseback transactions and acquire existing leased assets in the logistics and light industrial property sector. The ‘sweet spot’ will be transactions ranging from €10m to €200m, targeting a stabilised WALT in excess of five years across a portfolio of 30 to 40 industrial assets in defensible locations.