Industry veterans Dr. Wulf Meinel and Bruce Jenyon have teamed up to launch their new venture StoneVest AG, an investment and asset management vehicle which has ambitious plans to carve out a piece of the 'light industrial' and logistics market in Germany.
The company, based in Zürich, has already raised equity to give it firepower of €100m with the help of a strong seed investor, and has made its first two acquisitions in off-market deals. The partners, presenting the new business on a Zoom conference, said the goal was to target about €500m over the coming 3-5 years in German-speaking Europe.
StoneVest has launched the venture as a platform "Industrial Property Europe" under Luxembourg law. It will act as a co-investor and asset manager on the deals it does, and has kicked off the programme with two light-industrial properties valued at about €30m in Bavaria. The investing emphasis, said Meinel and Jenyon, is Core and manage-to-core, in long-term partnerships with institutional investors.
Both the assets are leased on a long-term basis to divisions of German manufacturing group AL-KO Kober group. DZ Hyp in Munich helped finance the deals.
Meinel said the German Mittelstand was beginning to see the value in freeing up capital from company-owned property assets to look closely at the benefits of sale-and-leasebacks. "Corporate-owned real estate assets in Germany are put at about €2.1 trillion, of which 35% are light-industrial properties. Of this only about €100 billion are owned by institutional investors, a number which is certainly set to rise. We're seeing both a greater willingness on behalf of corporates to cede direct ownership of operating property, and at the same time heightened interest from Family Offices and other institutional investors to get exposure to the asset class." He said in the post-Corona era, the segment could well become a 'mainstream' asset class.
The new company is focusing on ticket sizes of between €10m and €50m in both new-build and existing assets, and to manage the sale-and-leaseback deals to core.
Culturally and for a variety of other financial reasons, German companies have generally been averse to giving up ownership of their corporate-owned property, in contrast to the US or the UK, where institutions own up to 80% of manufacturing companies' operating buildings.
Meinel said, "From a business point of view, this doesn't make much sense. This is where StoneVest can take over the purchase and leasing as well as the development and management of their real estate for companies. As users, the companies can then focus fully on their core tasks. As their long-term partner, with a regional presence and 'on-site' tenant support, we ensure that the leased space always meets key operational requirements and is used efficiently."
Dr. Meinel was most recently the CEO of German-Dutch group Frasers Property Europe and before that the long-time German real estate boss of The Carlyle Group. Jenyon worked for many years for King Sturge and JLL in structured finance and valuation, as well as running his own business. The two have known each other for 20 years.