Privately-owned real estate manager Redevco has bundled all its retail warehouse park properties into a single, pan-European asset management platform worth €4.5 bn, at a time when retail real estate values are experiencing a rebound.
The platform was created by combining the properties of Germany’s Redos, in which Redevco acquired a majority stake last year, with its existing retail parks, located mainly in Belgium.
In total, the 180 assets have a gross lettable area (GLA) of 2.5 million m2 distributed across Germany (60% of GLA), Belgium (38% of GLA) and France (2% of GLA).
Commenting on the move, Herman Jan Faber, head of business development at Redevco said: ‘Redevco’s creation of one of the largest retail warehouse park asset management platforms in Europe, within the most resilient and best performing retail investment market sub-segment, coincides with what appears to be a bounce-back in retail real estate values after years of pressure from e-commerce competition and more recently the Covid pandemic.
'Even more noteworthy is that nearly half of our total €9.7 bn in assets under management can be transformed to create positive impact and help make cities more sustainable and liveable.’
Redevco pointed to research from Cushman & Wakefield showing that aggregated prime yields for retail warehouse parks in Belgium, Germany, Spain, France and the UK, were lower in September 2022 at 5.49% than pre-Covid in March 2020 (5.60%).
Retail parks also displayed strong rental stability with +4% growth over the same period compared with shopping centres (-10%) and high street shops (-17%).
Redevco said the pan-European scale of the combined new platform would enable the firm to expand its renewable energy production through solar panels to supply tenants, electric vehicle charging hubs and local power grids.
By the end of 2022, the company had installed around 32,000 photovoltaic panels at its Belgian retail warehouse parks, representing a generation capacity of 11.6 MWp, equivalent to powering nearly 2,800 households on an annual basis.
Faber also highlighted the potential of adding other functions to retail parks by tapping into high residual land values and actively managing frequently under-exploited and under-managed locations. Besides operating retail warehouse parks and convenience retail sites, Hamburg-based Redos has a growing urban logistics business which Redevco says allows for an integrated approach to servicing urban areas.
He said: ‘We also have the opportunity to create the core of thriving neighbourhoods in and around our parks, which are usually located in the peripheries of urban areas. Retail-anchored mixed-use developments could, where local planning permits, incorporate affordable and sustainable residential properties, to address Europe’s housing supply crisis, as well as building on other functions such as last-mile logistics.’