Singapore’s GIC to acquire ‘Maximus’ portfolio for around €950m

Singapore’s sovereign wealth fund GIC has signed an agreement to acquire a pan-European logistics portfolio, ‘Maximus’, from Apollo Global Management and Palmira Capital Partners for around €950m, GIC announced this week (13 December).

The portfolio comprises 1 million sqm of industrial space, or 28 logistics assets in core logistics hubs across Europe, such as Germany, Poland, Slovakia, Netherlands, Belgium and Austria. German assets account for 14 properties, or around €500m, in states including Bavaria and Baden Würrtemberg, someone familiar with the deal told REFIRE.

‘The portfolio is a mix of light industrial and logistic properties, mainly in core plus locations,’ an analyst, who asked not to be identified, told REFIRE.

The portfolio will be managed by P3 and enable it to build up its foothold in Western Europe. The portfolio’s well-diversified tenant base includes companies in the automotive, e-mobility, distribution, e-commerce and last-mile logistics sectors. The acquisition is expected to close during the first quarter of 2020, subject to customary closing conditions and any requisite regulatory approvals.

 ‘As a long-term value investor, logistics continues to be an attractive sector for GIC,’ said Lee Kok Sun, chief investment officer at GIC Real Estate. ‘It is set to keep growing, supported by strong e-commerce growth, and we expect it to generate steady income streams in the long run. Our P3 logistics platform in Europe is an important part of our global logistics portfolio, and this acquisition of high-quality, income-producing logistics assets across Europe is aligned with our strategy to efficiently scale up P3, and effectively strengthen its position as a leading developer and manager of logistics properties in the region.’

P3 will now integrate the ‘Maximus’ portfolio into its existing pan-European warehouse platform, according to its CIO, Otis Spencer: ‘This acquisition is one of the largest real estate investment deals in Europe this year, and the largest in Germany,’ he said. ‘This reflects our multi-faceted investment strategy to grow our market share in the pan-European market through both development and acquisition.’

Earlier this week, Dubai’s Rasmala Investment Bank and Gulf Islamic Investments sold two of Amazon’s logistics properties totaling around 166,000 sqm in Dortmund to Mirae Asset Daewoo Co. Ltd und Pacific Investment Management from South Korea for around €137m in a share deal. Union Investment is also believed to be in the process of selling its ‘Project North’ logistics portfolio comprising three assets, which is expected to sell for between €100m and €120m, according to those who track the market. Union Investment declined to comment.

There are likely to be between €6.5bn and €7.5bn of logistics deals in Germany this year, according to Dominic Thoma, team leader of industrial investment at JLL in Munich, potentially down slightly on the €7.47bn of deals recorded last year. ‘This is purely due to the lack of assets coming to market,’ he said. ‘There are lots of bidders for each process – they are hungry for logistics but there are not enough opportunities.’

Patrizia to acquire pan-European logistics portfolio for around €1.2bn

There have been other major logistics deals this month. Augsburg-based Patrizia is to acquire a pan-European portfolio of 42 logistics assets from BentallGreenOak for around €1.2bn on behalf of a logistics fund, it announced earlier this month.

Patrizia has backing from a club of institutional investors, comprising PFA Pension in Denmark and Public Officials Benefit Association (POBA) in South Korea as well as Patrizia Logistik-Invest Europa II (PLIE II).

Of the 42 acquired assets, 39 are yielding properties as well as three forward purchased new logistics developments in Italy and Spain which are partially pre-let. The portfolio comprises more than 1.4 million sqm of lettable space in the Netherlands, France, Italy and Spain as well as a further 138.000 sq m of lettable space for the three developments in Italy and Spain.

’It should be the biggest logistics deal of the year,’ Christian Kadel, head of capital markets in Germany at Colliers International, told REFIRE.

Following this deal, Patrizia has now invested €1.4bn in European logistics this year, a company spokesman told REFIRE. He declined to comment on the company’s investment plans for next year.

‘This purchase provides immediate exposure to a portfolio of institutional quality and scale across four separate markets, which will deliver robust, reliable returns to our investors,’ said Rob Brook, head of alternative investments at Patrizia. ‘Furthermore, with strong structural tailwinds and the highly attractive fundamentals of the logistics sector, we expect there to be additional potential opportunities for the portfolio to cover growth markets and to diversify the pan-European logistics platform further, due to a relatively low base of e-tailing penetration across Europe in contrast to some specific markets like the UK, Germany and The Netherlands.’

The properties are located in key European logistics corridors and were an attractive investment because they’re close to 90% income producing and let to a reputable and diverse tenant base of over 30 national and international businesses from the e-commerce, manufacturing and third party logistics sectors, according to a spokesman for the company. Tenants include Carrefour, Aldi, Dachser, DHL, Easydis, and Geodis. The overall portfolio weighted average unexpired lease term is more than seven years.

That’s not to say that Patrizia is eschewing the German logistics market. Earlier this year, it acquired a portfolio of six logistics properties in Germany from Australian real estate firm, Cromwell Property Group, for €59m on behalf of its Patrizia Logistik-Invest Europa II fund.

The portfolio comprised 43,500 sqm of total lettable space of ‘cross-dock’ logistics facilities – a type of logistics asset that is set up to reduce the time it takes for goods to be received, processed and then shipped to consumers, minimising the need for storage – and are fully let with an attractive average remaining lease term of more than ten years. Four out of the six units are occupied by German logistics firm, trans-o-flex Express GmbH. The units are situated in areas of high demand for logistics space including Hürth, Kassel, Koblenz, Neumünster, Leipheim and Neuseddin. 

BentallGreenOak is one of the most active investment managers in Europe’s logistics sector, having acquired or managed over 3.6 million sqm of assets across seven western European countries over the past five years. This year, it has acquired a further 1.45 million sqm of logistics space for its current funds. Speaking about the deal, Francesco Ostuni, European equity CIO at New-York based real estate group, BentallGreenOak, said: ‘BGO continues to believe that the logistics sector offers one of the best risk-adjusted returns in European real estate, and we still have significant capital to invest in the sector as our teams identify opportunities across Europe.’

Patrizia declined to comment on whether it had also considered Apollo’s portfolio.