Crossbay, the pan-European urban logistics platform of private equity real estate manager MARK, has launched a second investment fund which seeks to hold over €2bn worth of assets.
IPE Real Assets understands that Crossbay II, which will enter new markets such as the UK, Denmark and Sweden, is seeking to raise up to €1bn.
The previous Crossbay fund recently sold its €1.6bn portfolio of logistics assets located in Italy, Netherlands, Spain, France, Germany, Belgium and Poland to Prologis.
MARK said Crossbay II will acquire existing single-user last-mile facilities in major European gateway cities, focusing on assets in urban infill locations where rental growth is expected to be strongest.
Crossbay II will fund initial acquisitions through a €250m pan-European debt facility from Citi. The investment bank had previously provided €400m in debt financing for the first vehicle.
Marcus Meijer, CEO at MARK, said urban logistics remains an attractive investment opportunity thanks to compelling demand/supply dynamics and clear long-term growth drivers, from the shift away from physical retail to online shopping to the reordering of supply chains in the wake of Covid-19 and recent geopolitical events.
“In many European markets, e-commerce penetration continues to lag behind the US, and we expect online sales to rise as a proportion of overall retail spending, while the predominance of inflation-linked leases in Europe means we are well positioned to weather the current higher inflationary environment.
“The urban logistics sector’s strong underlying fundamentals combined with the price dislocation we are seeing presents a unique buying opportunity, while ultra-low vacancy rates provide clear room for rental growth. Rents make up a tiny fraction of corporate occupiers’ supply chain costs compared to transportation,” Meijer said.
Marco Riva, CEO of Crossbay and head of logistics at MARK, said: “The second Crossbay vehicle will build on the success of the first by leveraging our teams on the ground to execute more value-add and leasing initiatives to drive value and capture rental growth, and increasing development activity where appropriate, with all new developments built to meet our strict ESG requirements.
“The new facility provided by Citi, enabled by the strong relationship we established through the first Crossbay vehicle, will reinforce Crossbay’s market reputation for speed and certainty of execution.
“We have a solid pipeline of opportunity, but will deploy capital selectively, focusing exclusively on attractively priced assets at very healthy premiums to prime yields that we are able to access off-market through our embedded local teams.”
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