Warehouse giant GLP has exceeded expectations for its latest European investment vehicle with Asia’s largest logistics developer announcing on Friday that it had raised an additional €500 million ($604 million) for the core strategy.
The Singapore-based firm has now brought in commitments of around €1.6 billion in equity for GLP Europe Income Partners II (GLP EIP II), which the company says goes beyond its original goal for the vehicle. With leverage, GLP now estimates that the fund will be able to reach €3.2 billion in assets under management.
“Since its inception, GLP EIP II has performed exceptionally well, which led to very strong investor demand and we exceeded our fund target,” said GLP managing director for fund management Ralf Wessel.
Logistics real estate developers and fund managers such as GLP have been among the most successful capital raisers since the dawn of the COVID-19 pandemic, with the company noting in its release that it has added approximately $16 billion of assets under management to its logistics strategies over the past 12 months.
Looking Forward to European Growth
GLP has yet to provide specifics regarding its limited partners in GLP Europe Income Partners II, however, it did indicate that the fresh capital came from institutional investment partners across Europe, the Middle East and Asia.
The fund is GLP’s fourth European investment vehicle, with the company now managing €10 billion in assets in the region.
For its first pair of European funds, the company had received equity commitments from Oxford Properties, the real estate division of Ontario Municipal Employees Retirement System (OMERS), as well as British Columbia’s Quadreal Property Group, the Korea Fire Officials Credit Union and Tesco Pension Investment of the UK.
In a statement released when it achieved its €1.1 billion first closing on GLP Europe Income Partners II in September last year, GLP said that the fund had received backing from both new and existing partners of the company. The core fund aims to invest in income producing assets in nine European countries, however, GLP has yet to specify publicly about its fund raising goals for the vehicle.
“We expect the European logistics market to accelerate in 2021 and will continue to execute on our disciplined growth strategy to acquire high-quality assets in prime locations,” GLP Europe president Nick Cook said. Figures from data provider Real Capital Analytics show that logistics was the only major property type to register higher deal activity in Europe during the first nine months of 2020 than during the same period a year earlier.
Also last week, GLP announced that it was beginning construction on one million square feet (93,000 square metres) of warehouses in the UK, with that development portfolio spanning four sites.
Fund Backed by Stabilised Portfolio
GLP Europe Income Partners II derives its cashflow from a set of 25 distribution centres across the continent, with the properties averaging less than five years in age, according to an earlier release by GLP.
The portfolio measures 1.9 million square metres and was 97 percent occupied according to the company’s announcement in September last year. The average weighted period to lease expiry of the properties at the time was nearly seven years. The company said at the time that it would continue to acquire properties on behalf of the fund.
GLP’s progress with its European core fund parallels announcements that it has made for similar vehicles in Asia.
Earlier this month the company announced that it had reached a second closing of GLP Japan Income Fund with JPY 560 billion ($5.4 billion) in equity raised for that vehicle.
In April last year GLP reached a final close on its China Income Fund I (CIF I) with the company having previously stated that it aimed to build assets under management of RMB 15 billion ($2.1 billion) for that core property vehicle.