'We've always got an ever-changing and dynamic pipeline. In the previous three-to-four months, we saw more transactions outside of Germany. However, in the last two weeks, we've seen a significant increase in our German pipeline. Some deals there are under exclusivity, some are in due diligence. We are signing a logistics deal just outside Cologne on 30 April and we have a lot of deals in the pipeline, so we should hit €800 mln by the year-end,' he said.

The property, which Gramercy Europe acquired for €10.43 mln, is a cross-dock logistics facility located within a commercial park in Frechen, Germany, approximately 10 km west of Cologne. The property totals 18,400 m2 of leasable area and is fully leased to t-log trinklogistik, an operating subsidiary of German food supermarket retailer Edeka.

'We have quite a number of deals in the pipeline in Germany, most of which are between €10 mln and €30 mln. They are all single-asset sales and most of them are logistics properties. We have two transactions under exclusivity in eastern German markets and we're also working on a number of smaller deals in cities such as Hannover,' Calvert added.

It was a bumper year for German logistics last year, with €4 bn in deals, an increase of 14% on 2014, according to JLL. In the fourth quarter alone, €1.4 bn in deals were recorded. 'There was never a quarter in Germany in which more was invested in logistics than in the fourth quarter of 2015,' said Willi Weis, head of industrial investment at JLL in Germany. This year, JLL is forecasting that the deal volume will surpass last year's level.

Logistics assets account for 63.5% of the Gramercy Property Europe fund, which was launched almost a year ago and has since built up a portfolio of €298.47 mln. Retail accounts for another 24%, special purpose - including premises comprising both an HQ office and a production facility - for 8% and offices for 4.4%. The fund has an annual equity yield target in excess of 10%.

'We're very cognizant of our ability to reposition assets but we’re also very lease-term driven, so we will sometimes sacrifice location in favour of longer-lease terms,' Calvert explained.

Gramercy aims to invest around 50% of the fund in Germany with an additional 30% in the Netherlands, Calvert said. The remaining 20% can include investment in markets such as Poland and France. Gramercy is currently eyeing larger portfolio transactions in the Netherlands, including a portfolio with a retail and logistics component, Calvert said. 'We are also working on two portfolios in France, one of which includes an Île de France asset. The other portfolio comprises several logistics assets on one site in a French logistics hotspot,' he added, declining to provide further details.

However, increased competition in the logistics sector has had a significant impact on yields in the past year, Calvert said. 'Yields in Germany for A- stock in B/B+ locations for a property on an eight-year lease have fallen by up to 75 bps in German cities, excluding the 'Big 7', over the past year. That’s a significant change,' he said. Typical German logistics yields fell to 5.27% at the end of last year, according to JLL.

Gramercy is also open to following existing tenants into new geographical markets, according to Calvert: 'We have a close relationship with our tenants so although markets such as Germany, the Netherlands and France are our core markets, we would consider following existing tenants into markets such as the Czech Republic and Spain if it made strategic sense.'