Denmark’s PFA has announced it is investing around DKK500m (€67m) in a logistics property in Brooklyn in the US - as part of a mandate agreement with Thor Equities to invest up to about DKK1.2bn in US logistics assets.
The new investment is the purchase of 95% of a logistics property currently under construction in Red Hook, Brooklyn, on which Amazon has already agreed a 15-year lease, guaranteed by the main company, said Denmark’s second-biggest pension fund.
Thor Equities will own the remaining 5% of the property, and manage the asset, PFA said.
Henrik Nøhr Poulsen, head of international real estate at PFA, said: “The property is being built in a great location on the waterfront in Brooklyn close to both city and infrastructure, making it particularly suitable for last-mile logistics and efficient day-to-day delivery in New York City.”
It was a “rare opportunity to develop a state-of-the-art logistics facility in a growing area and with a solid tenant in Amazon on a long lease”, he said.
Construction on the property - which covers a total area of around 15,000sqm - began in the first quarter of this year, and is expected to be completed in spring 2022, according to PFA.
The building contractor is the New Jersey-based firm March.
PFA said the Brooklyn investment was the first deal in a mandate it had just agreed with Thor Equities, involving a total commitment of up to approximately DKK1.2bn in logistics properties in the US.
The Danish firm said it has worked with Thor Equities on previous US investments including life sciences offices and laboratories in New Jersey.
Michael Bruhn, PFA’s head of real estate, said the investment fitted in with a key part of the Danish pension firm’s 2021 investment strategy - to continue expanding foreign real estate investments, focusing on sectors driven by international megatrends such as logistics and online trading.
“With the investment, we can gain further exposure to the significant growth in online commerce, which the coronavirus crisis has accelerated markedly, and which has created sharply increasing demand for modern well-located logistics facilities in general, and not least in New York,” he said.
Because of this, Bruhn said PFA expected the investment to produce attractive returns for its customers.
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