Riding high on a wave of Asia Pacific acquisitions, PGIM Real Estate splashed out again this week to take a large chunk of an Australian logistics portfolio from fellow US-based fund manager Blackstone.
Market sources confirmed to Mingtiandi on Thursday that PGIM, an affiliate of US financial giant Prudential, had partnered with Canadian insurer Manulife to acquire a 90 percent stake in the 20-asset portfolio from Blackstone for A$850 million ($663 million).
Together with Manulife, PGIM is buying out Blackstone’s stake in the industrial venture, as alternative asset manager Fife Capital continues in its role as minority investor and manager of the platform.
Steve Bulloch, managing director and head of Australia for PGIM Real Estate, acknowledged the deal on Wednesday but offered few specifics.
“PGIM Real Estate is able to confirm it is a co-investor in the portfolio,” Bulloch told the Australian Financial Review. “We are very pleased with the deal and the partnership but unable to provide further details at this time.”
Oz Sheds Stay Hot
News of the Fife portfolio deal came on the heels of Blackstone selling a different set of Australian sheds, the Milestone Logistics portfolio, to ESR Milestone Partnership, a collaborative venture between ESR and Singapore sovereign wealth fund GIC, for A$3.8 billion.
The Milestone sale, which ended a bidding contest pitting Hong Kong-listed ESR and its Singaporean partner against four other contenders, sets a new bar for warehouse investments in Australia as increased competition squeezes investment yields.
Blackstone had originally put up the Fife portfolio for sale in early 2020 before shelving the campaign on COVID-19 concerns. The A$850 million consideration puts the capitalisation rate at 4.5 percent for the investment.
PGIM Real Estate previously struck a deal with Fife Capital in 2018 when it acquired a 75 percent interest in the prime retail and commercial component of the York & George mixed-use project developed by Fife at 383 George Street in Sydney. PGIM owns the asset in conjunction with the seller, a Fife-managed investment partnership.
PGIM Real Estate remains on a tear in APAC, announcing on Wednesday that it had added an office building in Tokyo’s Toyocho area to its list of big-ticket buys in 2021. The firm purchased the six-storey Lucid Square Toyocho from Hong Kong-based private equity firm PAG for about $120 million, according to individuals active in the market.
Just a day earlier, PGIM had confirmed its purchase of the 108 Robinson Road office building in central Singapore for $107 million after Mingtiandi reported the transaction last week.
PGIM purchased the former Finexis Building from local private equity firm Sin Capital Group, with the string of acquisitions in the region following the US investment manager’s final closing in January on a $1 billion Asia Pacific value-add fund.