UK-based investment bank Investec has acquired a €900 mln stake in a 40-asset pan-European property portfolio from its joint venture partner, global alternative investment manager Ares Management.
The joint venture between Ares real estate funds and the Investec property fund began aggregating the portfolio in January 2018, and through 12 separate transactions, grew the portfolio to include 40 properties across 31 locations covering more than 1,000,000 m2, according to the firms.
'In embarking on this aggregation strategy, our objective was to build a scaled portfolio of well-located, income-generating logistics assets with clear value-add potential across Europe’s major logistics corridors,' said Wilson Lamont, partner and co-head of European real estate equity at Ares.
The properties are generally mid-sized and located near airports, ports, and population centres in the major logistics corridors of six European countries, including Germany, France, and the Netherlands. Since aggregating the portfolio, the joint venture said it improved occupancy levels to 99% and extended average lease terms.
'During our two years of ownership, we built a strong relationship with the principals of Investec property fund and together, we were able to drive full occupancy, extend lease terms, and mark rents to market, creating value across the portfolio while simultaneously developing approximately 36,500 m2 on surplus land,' Lamont added.
'The acquisition of the remaining interest in this pan-European logistics portfolio from Ares presents Investec property fund with a unique opportunity to execute on our intended strategy to deploy capital into portfolios that have a demonstrated track record, and are capturing growth stemming from positive underlying property fundamentals,' said joint chief executives of Investec property fund, Andrew Wooler and Darryl Mayers.
Post-sale, the combined in-country asset management teams will remain on board, they added.