Hines’s €3bn European Value Fund 2 (HEVF 2) has entered the logistics sector for the first time, signing a forward-purchase on a new 82,300sqm development in the Bologna region of Italy.
Castel San Pietro Logistics (CSP Logistics) is being developed by the seller, FAP Investments. Once completed in 2022, it will comprise two mid-box units of 37,300sqm and 45,000sqm, respectively.
Hines’s European value-add fund series has historically focused on office markets, but the company said it had increased its emphasis on the logistics sector “in line with the structurally improving fundamentals”.
Hines said it expected to make further logistics investments in 2021 for the fund.
Paul White, HEVF 2 fund manager, said: “The growth in e-commerce continues to drive huge demand for well-located logistics, particularly in key European distribution hubs, so this acquisition squarely meets our strategy of increasing the fund’s exposure to the sector.
“Our platform gives us the scope and capacity to source and execute major investments across all sectors, with a particular focus on logistics and residential in the immediate term.
“We have a strong conviction for Italy and this region in particular as a primary logistics node. The country’s appetite for e-commerce is accelerating at pace and we anticipate demand for such key distribution facilities significantly outweighing supply providing the strong underlying fundamentals which align with our investment strategy.”
CSP Logistics, acquired off-market for an undisclosed price, is located in the logistics hub of Castel San Pietro, one of the three primary Italian industrial districts and a nexus for the country’s main transport routes. The site is on the edge of the E45 motorway offering connectivity across northern and central Italy.
Mario Abbadessa, senior managing director and country head for Italy at Hines, said: “CSP Logistics presents a compelling off-market opportunity to capitalise on the lack of institutional logistics supply in the Bologna area where available land for development is limited.”
He added: “In Italy, we are aiming to invest €1bn in both traditional and last-mile logistics over the next two years, with the ongoing digitalisation of the market making the sector an increasingly appealing asset class.”
It is the fifth acquisition for HEVF 2, bringing the amount of equity allocated by the fund to almost €390m. With leverage, HEVF 2 is expected to have total purchasing power approaching €3bn, making it Hines’s largest closed-ended fund in Europe to date.
Hines also announced the purchase of an Amazon-leased e-commerce fulfilment centre in the US on behalf of its non-listed real estate investment trust Hines Global Income Trust.
The 1,262,294sqft, class-A asset is located in the I-35 corridor between San Antonio and Austin, offering direct access to the so-called Texas Triangle, with a population of more 25m living in or around Austin/San Antonio, Houston and the Dallas/Fort Worth metros.
“This is a critical location with a high growth consumer base,” said Laura Denkler, managing director at Hines.
“We continue to pursue logistics assets with immediate proximity to population density and solid connectivity to major thoroughfares.”