GIC Acquiring $1.1B European Logistics Portfolio From Apollo Global Management

Singapore’s sovereign wealth fund GIC is ramping up its European logistics platform by agreeing to acquire a collection of 28 distribution facilities from Apollo Global Management for about €950 million ($1.1 billion). GIC said that it will integrate the Maximus portfolio, which spans more than 1 million square metres (10.8 million square feet) of industrial space in the continent, into its existing pan-European warehouse platform P3 Logistic Parks.

GIC, which has an estimated $100 billion of global assets under management, acquired P3 for €2.4 billion ($2.6 billion) from TPG Real Estate and Ivanhoé Cambridge in 2016. The Prague-based platform currently has 230 buildings totalling 5.3 million square metres of lettable area, with 1.2 million square metres of space in the pipeline across 13 countries, according to P3’s corporate website.

Through the newly announced deal, expected to close in the first quarter of next year, GIC will take over a portfolio of assets located in core logistics hubs across countries including Austria, Belgium, Germany, the Netherlands, Poland and Slovakia. P3 will manage the portfolio, whose tenant roster includes firms in the automotive, electric vehicle equipment, distribution, e-commerce and last-mile logistics sectors, among others.

The acquisition is the largest real estate investment deal in Germany this year and one of the largest in Europe. The transaction also continues a continental deal streak for GIC, which earlier this year bought a 25 percent stake in the €2 billion ($2.25 billion) European hotel owner-operator citizenM.

P3 Eyes More Investments

“As a long-term value investor, logistics continues to be an attractive sector for GIC,” noted Lee Kok Sun, chief investment officer of GIC Real Estate in a statement. “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’s chief investment officer Otis Spencer added that the logistics firm is actively seeking further investment deals. Goh Kok Huat, former chief operating officer of GIC, took the reins as chairman of the board of P3 in October, while Tim Beaudin was appointed as CEO.

GIC had been the largest shareholder in Global Logistic Properties (GLP), until CEO Ming Mei led a $11.6 buyout of the world’s second-biggest logistics developer in 2017. The Singaporean fund last year agreed to invest $2 billion in a GLP China value-add warehouse fund.

Singaporeans Continue Overseas Deal Spree

The sovereign fund’s latest warehouse acquisition comes after Singapore-based real estate group Frasers Property in July revealed a plan to consolidate its rapidly growing Australian and European industrial and logistics businesses by creating a single platform with S$5.4 billion ($4 billion) in assets. The group has spent over $3 billion building up a logistics and industrial portfolio in the two regions over the past five years.

Another Singapore-based firm grabbed headlines this year, with logistics giant GLP agreeing to sell U.S. warehouse assets to Blackstone for a record-breaking $18.7 billion. The transaction closed in September.

GIC’s interest in Europe extends beyond sheds. The company teamed up with Caleus Capital Investors to acquire the landmark Hotel de Rome in Berlin in an off-market deal in November, shortly after GIC snapped up PB6, a trophy office tower in Paris for a reported €530 million ($592.25 million).