ARA Europe, the European platform of ESR Group, has acquired an urban logistics complex, located on the outskirts of Rouen in France, on behalf of its ARA Europe Active Real Estate Fund V.
The acquisition forms part of the fund’s seed portfolio, which focuses on the aggregation of well-located last-mile distribution warehouses within the French logistics corridor.
The complex includes four existing buildings totalling 28,000 m2 which are 96% let to leading operators including Chronopost, VIR Transports and UPS, as well as 5,000 m2 of logistics space to be developed on brownfield sites via two forward-funding schemes with pre-agreed fixed price contracts.
The site is strategically located in the immediate vicinity of a major container port as well as critical highways such as the A13, A28 and A150.
Quentin Kerrault, head of investment at ARA Europe, commented: 'Vacancy rates in the logistics sector in France are extremely low, standing at 4.7% in Q4 2023 according to CBRE, and acquiring this complex in a major industrial cluster adjacent to Rouen's city centre provides us with strategic buildings, well located for urban logistics.
'Demand, boosted by e-commerce, and lack of supply, make a compelling investment case for such assets. We continue to seek similar opportunities with excellent fundamentals and value creation potential.'
The four existing buildings which will be upgraded and two properties to be developed are expected to obtain BREEAM Very Good environmental certification for their ESG features including solar panels, LED lighting, EV charging points and cycle racks.
The purchase expands the seed portfolio following an earlier acquisition of three other assets located along the French logistics corridor as ARA Europe continues its logistics aggregation strategy in France.
In France, ARA Europe’s logistics portfolio now comprises a dozen buildings, totalling more than 250,000 m2. It continues to deploy an active investment strategy to identify other opportunities in the industrial and logistics sector.
ARA Europe was advised by notary firm Le Breton, law firm Mayer Brown, Racine for tax matters and Etyo for technical aspects. The building was financed with the assistance of Société Générale as senior lender.
