Invesco Real Estate’s third European value-add strategy has made its debut mezzanine lending deal in Central Europe.
Invesco Real Estate Europe Fund III has issued a €20m loan secured against a new 124,000sqm logistics facility in Psary, Poland owned by local developer DL Invest.
The DL Invest Park Psary asset is fully let.
Invesco said the capital received by DL Invest will be allocated towards further expansion of its build-to-suit pipeline.
DL Invest’s portfolio currently encompasses more than 2m sqm of real estate assets, with a total group asset valuation of €786m.
Tomas Picha, senior director of CEE investments at Invesco Real Estate, said: “The underlying fundamentals of the logistics market in this southern Polish region, particularly for super prime assets, remain very attractive and help to create excellent opportunities for well-placed borrowers such as DL Invest Group. We are delighted to be supporting the business as it looks to capitalise.”
In October last year, IPE Real Assets reported that Invesco was expanding the strategy of its latest European value-add fund to include debt to enable it to invest in preferred equity and debt in a bid to capitalise on disruption across real estate markets.
At the time, the fund, which was seeking to raise up to €1bn, had raised €400m in a first close.
To take advantage of an anticipated disruption in the UK and continental Europe, the fund will be able to invest across the capital stack, in both equity, preferred equity and debt.
Kevin Grundy, managing director of Europe fund management at Invesco Real Estate, said: “This mezzanine loan is an excellent fit for the early investment programme of our third European value-add fund. The strategy for Europe III is differentiated from its peers, drawing upon structuring flexibility to achieve the best relative value from real estate investments.
“Everything we do starts with the underlying real estate, and most of the strategy will involve structured equity investment. However, in this instance we brought together our equity and debt specialists to deliver a structure that matches our return targets and yet enjoys an insulated position linked to prime real estate and an experienced sponsor.”
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