Madison International Realty acquires stake in 30-asset European logistics portfolio
Madison International Realty, a leading real estate private equity firm, announces that it has acquired a stake in a 30-asset European logistics and light industrial portfolio alongside local partner, Cairn Real Estate, investing through its specialist Dutch logistics vehicle, the Gateway Fund.
Madison has initially invested € 22.5 million, which will increase to € 50 million over the coming 18 months and give Madison a significant stake in the portfolio.
Approximately 90% of the portfolio by value is situated in The Netherlands, along major transit corridors and adjacent to key population centres. The remaining properties are located on similarly well-connected sites in Germany. The portfolio has a 99.3% occupancy rate with international tenants.
The modern logistics and light industrial portfolio has an average construction year of 2005, with 80% of the assets built-to-suit for single tenants with distinct specifications and fit out requirements. One example is a 31,000 sqm distribution centre in Zaltbommel, the Netherlands, which is occupied by Hitachi and also serves as the company’s EMEA headquarters. Built in 2013, the building is BREEAM ‘Very Good’ rated and at the time of construction had the largest solar panel installation on a roof in the Netherlands, as well as thermal storage, thermal active floors and charging stations for electric vehicles.
Rent collection rates across the portfolio have remained high throughout 2020 with over 98% of rent paid every month throughout the COVID-19 pandemic, while The Netherlands, in particular, has seen increased transaction volumes in the logistics sector alongside favourable yield movements.
Alex Lukesch, Managing Director at Madison International Realty commented on the investment: “This acquisition has allowed us to secure a significant stake in a state-of-the-art logistics and light industrial portfolio across two key geographies and grow our European exposure further. The logistics sector remains one of our conviction buys and has continued to flourish throughout 2020, with the high levels of rent collection testament to its durability, while COVID-19 has also accelerated the trends that were already in place such as the rise of e-commerce and consumer demand for faster deliveries.
This transaction is typical of our investment strategy to partner with highly respected local partners and allows us to access Cairn Real Estate’s deep experience and connections within the Dutch logistics market. We look forward to working alongside them as new partners.”
Pieter Akkerman, Managing Director at Cairn Real Estate, added: “Logistics and light industrial properties are stable cornerstones of our real estate strategy. This segment has proven to be robust during the COVID 19 pandemic with market fundamentals remaining strong, solid demand from e-commerce further taking hold, disciplined supply and land scarcity. The successful recapitalization shows that investor demand is also stable and we are proud that we were able to attract a new institutional investor like Madison International Realty to our Gateway Fund. We look forward to working together with Madison on our strategy".
Madison was advised by CBRE.