Warburg Pincus JV With Wide Creek Picks Up Second Korean Logistics Asset

Warburg Pincus has acquired a second logistics asset in South Korea under the US fund manager’s joint venture with Seoul-based Wide Creek Asset Management, boosting the partnership’s net leasable area under management to 244,000 square metres (2.6 million square feet).

The JV picked up an 82,000 square metre site in the Gyeonggi provincial city of Anseong, south of Seoul, with plans to develop a five-storey dry warehouse with a net leasable area of 100,000 square metres, Warburg Pincus said Tuesday in a release. About 70 percent of the space has been pre-leased to tenants in the life sciences sector, the firm said.

The private equity major set up the JV in 2023 through its Warburg Pincus Asia Real Estate Fund to focus on investments in “new economy” real estate sectors like logistics, data centres, life sciences and business parks in South Korea. That year the venture acquired its first site in Gyeonggi’s Yangju to develop a last-mile logistics centre with a net leasable area of 144,272 square metres.

“We have built a high conviction in the long-term opportunities in South Korea’s logistics market and have strategically focused on prime assets in key metropolitan areas to address the demand-supply gap,” said Warburg Pincus managing director Fan Li. “Through our partnership with Wide Creek, we have been deeply impressed by its strong management team and unique capabilities in identifying and acquiring high-quality new economy real estate assets.”

$500M Completion Value

The latest transaction gives the JV’s portfolio an estimated value of more than $500 million upon completion, Warburg Pincus said. The site’s seller wasn’t disclosed.

Situated in Anseong, a hub for 3PL, life sciences and high-tech manufacturing, the new logistics centre is within a 35 kilometre (21.7 mile) radius of many large industrial complexes. The project’s roster of pre-leased tenants includes players in the pharmaceutical and healthcare sectors, underscoring the asset’s role in supporting the emerging life sciences sector in South Korea, according to Warburg Pincus.

Wide Creek has set up 14 development projects since its 2020 inception, accumulating assets under management in excess of KRW 2.9 trillion ($2 billion). Co-founder and CEO Kim Junghoon hailed the Anseong acquisition as a “major milestone” for the two-year-old JV.

“As one of the largest real estate investors in Asia Pacific, Warburg Pincus has a proven track record of building and scaling multiple new economy real estate platforms and ventures,” Kim said. “We look forward to continuing our partnership with Warburg Pincus to unlock the full value of this collaboration and meet the increasing demand from high-quality tenants in South Korea.”

K-Wave Cruises On

Manhattan-based Warburg Pincus, with $87 billion in assets under management, is expanding its local logistics footprint after announcing a third venture in South Korea through the Asia Real Estate Fund earlier this month.

In that tie-up, Warburg is partnering with SK D&D, a real estate development unit of Seoul-based conglomerate SK Group, and its asset management unit D&D Investment to acquire and develop senior housing in the Greater Seoul area.

Warburg Pincus rolled out its Qube Industrial platform in December 2023 through a collaboration with Seoul-based 3PL provider and warehouse developer MQ. The partners recently announced the acquisition of a sixth asset for their portfolio.

In March of last year, Weave Living, a rental housing investment and operating platform backed by Warburg Pincus, entered the Korean market through a venture with KKR.