Oxford Properties buys M7 as it plans to pump £3bn into European logistics

Oxford Properties Group, the real estate arm of Canadian pension fund OMERS, has confirmed that it is buying European fund manager M7 Real Estate.

The C$80bn (€51bn) real estate investor said it was making the acquisition as part of plans to deploy £3bn (€3.33bn) into multi-let industrial and urban logistics across Europe.

M7 Real Estate, which manages about €4bn of assets on behalf of third-party investors, will continue to operate as a standalone business, led by co-founders Richard Croft and David Ebbrell.

Under the new ownership, the company will have access to a greater pool of capital for both real estate and corporate investments.

“Oxford had previously stated its ambition to deploy £3bn of capital into the European logistics sector, and the acquisition gives it immediate scale to do so,” the investor said.

“Oxford will also benefit from M7’s management team’s expertise when considering additional corporate or portfolio acquisitions that might provide it with further access across these target sectors.

“The acquisition of M7 also presents opportunities for Oxford’s investment partners to deploy capital in the much sought-after European logistics sector and grow M7’s third-party capital under management.”

It is not the first time that Oxford Properties has acquired a fund management business. In 2018, it beat Blackstone in a bidding war for the Investa Office Fund in Australia and in November 2020 bought a stake in Investment Office Management Holdings.

Oxford Properties likened its purchase of M7 to that of Investa, and other corporate acquisitions including UK build-to-rent operator Get Living and IDI Logistics in the US.

Jo McNamara, executive vice president for Europe at Oxford Properties, said: “This transaction is a perfect example of how Oxford is creative with its capital to access opportunities in the asset classes and geographies where we have highest conviction.

“We can purchase properties and portfolios, develop, invest in debt or equities, and acquire businesses, all in service of our capital allocation priorities.”

She added: “Across the globe, our investment partners are increasingly asking us to access the opportunities presented by the Oxford platform and portfolio of businesses. Our acquisition of M7 also allows our partners to invest capital with a best-in-class management team in a sector with great growth prospects.”

M7 Real estate was established in 2009 by former Halverton executives to invest in light industrial and urban logistics in Europe. Today, it has 225 employees in 14 countries and manages a portfolio of 620 assets.

McNamara said: “M7 is a market-leading platform, led by a highly ambitious and entrepreneurial management team that has deep-rooted expertise in the sector, through which we intend to significantly expand and accelerate our investment in this asset class across Europe.”

Croft, executive chairman at M7 Real Estate, said: “From a standing start 11 years ago, we have built M7 into a market-leading investment management business with over €4bn of assets under management.

“This transaction provides us with the support and resources of a significant global real estate investor which shares both our entrepreneurial ethos and our strong ambition to grow the M7 business substantially over the next few years to create a truly world-class industrial-focused asset and investment management platform.”

To read the digital edition of the latest IPE Real Assets magazine click here.