M&G Real Estate has invested €40.6m to buy the fully-let Ontígola Logistics Platform in Madrid, Spain from Barings.

M&G Real Estate said the latest acquisition, which was done on behalf of the €4.4bn M&G European Property Fund, lifts the manager’s total exposure to Spain €1bn.

The newly built Ontígola Logistics Platform, located in the Dehesa de la Plata II industrial park, comprises two large-scale warehouses totalling 48,700sqm.

Federico Bros, head of investment and asset management for Iberia at M&G Real Estate, said the latest acquisition brings M&G Real Estate’s logistics footprint in Spain to 330,000sqm.

“The spectacular growth in Spanish e-commerce in 2020 has brought us closer to European levels, but there is still significant room to grow until we see the number of Spanish internet shoppers reaching the levels we are seeing in France, Germany and the UK.

“This growth will continue to underpin high demand for strategically-located, modern logistics platforms like Ontígola, supporting positive rental growth for our investors.”

David Jackson, manager of M&G European Property Fund, said: “The pandemic has accelerated trends already evident in real estate, such as the rapid expansion of e-commerce and the consequent need for modern distribution warehouses capable of helping companies meet the growing demands from online shopping.

“We see long-term investment opportunities in the sector across Continental Europe, and this acquisition adds to our recently acquired logistics facilities in the Nordics as we continue to increase our exposure to the sector.”

The asset was sold by Barings, on behalf of its value add real estate fund, BREEVA I.

The asset was sold by Barings, on behalf of its value add real estate fund, BREEVA I.

Valeria Falcone, managing director and head of value-add investing Europe at Barings, said: “This is the fifth sale we have made on behalf of BREEVA I, as we realise our investments following the close of the fund and the gradual completion of our business plans.

“The sale adds to the fund’s strong performance to-date, which continues to outperform industry benchmarks. We remain very active in the investment market, with the strong returns generated by this project endorsing our conviction in European logistics, which continues to play an important part of our broader strategy.”

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