The Polish prize is leased entirely to home improvement retailer Castorama
Savills Investment Management on Monday said it had exchanged contracts to acquire a logistics property in Poland for a Korean-backed fund at a price of €65.5 million ($79.6 million).
The transaction is Savills IM’s second on behalf of Vestas European Strategic Allocation Logistics Fund (VESALF I), a pan-European logistics investment fund launched in partnership with Seoul-based Vestas Investment Management last November.
“The logistics market remains a bright spot within the real estate landscape, and Savills IM is very active in the sector,” said Alistair Ennever, director of strategic partnerships at the fund manager. “We have made a strong start to the year and look forward to further activity across Europe in the coming months.”
The seller is Tritax EuroBox, a London-based warehouse landlord. The 100,000 square metre (1,076,391 square foot) facility in Lodz is under lease to Castorama, a French home-improvement retailer, with 6.7 years remaining on the term.
Blind Bets
As a blind fund, VESALF I raises capital from Korean institutional investors to invest on their behalf, targeting logistics assets in key European markets. According to a Korean media account, the institutions in the blind pool include local pension funds and credit unions, and the annual internal rate of return on investment is estimated at 8 percent.
Alistair Ennever of Savills Investment Management
VESALF I was seeded with the late-2020 acquisition of a new 115,000 square metre warehouse leased to Danish transport and logistics operator DSV in Tholen, Netherlands. The fund targets a gross asset value of up to €500 million.
Vestas also linked up with Savills IM last April to acquire a 123,000 square metre warehouse just north of Lodz for €71 million. The seller of that central Poland mega-shed was Invesco Real Estate, the property arm of the US investment giant.
Just a few weeks before last year’s Lodz transaction, the UK-SK collaborators teamed up to purchase a property portfolio from DSV that included an office building and two logistics assets in Denmark.
Favouring Logistics
This week’s Poland buy was announced after Savills IM late last year had highlighted logistics assets as prime long-term investments in Asia Pacific going into 2021.
In a report released in November, the fund manager revealed that logistics led all asset classes with regard to favourability for this year, buoyed by continued growth in e-commerce, favourable structural tailwinds and policy support in the form of the 15-member APAC Regional Economic Comprehensive Partnership.
Savills IM’s survey-based research found 57 percent of investors predicting increased exposure in big box distribution and fulfilment centres and 55 percent considering investment in last-mile and urban logistics assets.
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