In a significant logistics deal, the pan-European real estate investment manager Europa Capital sold a Dutch and German portfolio of urban logistics and warehouse assets to Strategic Industrial Real Estate (SIRE), Arrow Capital Partners’ platform backed by Cerberus. The price was put at €270m.
Europa Capital was acting on behalf of its pan-European funds, Europa Fund V (EFV) and Europa Fund VI (EFVI).
Geographically, the 38-asset portfolio with 360,000 sqm of lettable space is located along the major transport corridors in the Netherlands and Germany. The portfolio was assembled on a piecemeal basis by Europa Capital since 2018 on behalf of three different value-add investment mandates. The assets were bought with a view to improving occupancy and restructuring leases. The current occupancy rate is 91%, with major tenants including Lekkerland, Deutsche Post Immobilien (DHL), Dutch Organic International Trade B.V., Fahrrad XXL Feld GmbH, and CWS boco Deutschland GmbH.
The Australian-headquartered Arrow Capital Partners has been targeting European last-mile and strategic logistics assets in its partnership with private equity group Cerberus for the past two years. This acquisition should fit in well with its existing portfolio in the Netherlands and Germany.
Europa Capital's James Pennington said: “This landmark sale represents one of the largest ever for Europa Capital and is the culmination of three successful investment strategies and multiple asset purchases."
Robert Howe, Arrow's head of European real estate, said: “This is a balanced portfolio of high quality logistics assets in prime locations which consolidates our growing position in two of SIRE’s priority markets. This acquisition continues our investment in assets where we can add value and which are benefiting from a scarcity of supply and growing occupational demand. We have acquired over EUR1 billion in our SIRE strategy over the last 12 months in multiple markets in Europe and are looking to deploy a further EUR2 billion over the next two years, including assets with income, opportunity to refurbish and ground up development.”
Separately, Arrow also agree to fund a major new logistics site as part of its European strategy for urban logistics development. The development site, at Osterweddingen near Magdeburg, is 70% complete and due to be delivered in the second half of the year by local developer eab invest. The site is 51,000 sqm including a logistics building of 23,000 sqm split into a possible four separate units. Arrow is funding the development also from its €3bn SIRE platform.
Danilo Hunker, Arrow's head of Germany, said of the funding: 'We intend to invest more than €600 mln into the German urban logistics market over the next three years, targeting urban logistics assets with income, vacancy or refurbishment potential as well as more development opportunities like Osterweddingen, both on a forward funding and forward commitment basis.'
In May, Arrow also concluded a deal to buy an industrial site in Riegel in southern Germany on behalf of its SIRE platform. The 21,320 sqm site includes a logistics building of 9,200 sqm, and is currently largely let out to Lekkerland, the wholesaler to the convenience sector owned by grocery chain REWE.
