Aviva, LaSalle buy logistics asset in Munich for joint fund

Aviva Investors and LaSalle Investment Management have acquired a Grade A logistics warehouse at Bergkirchen, near Munich for their Encore+ fund for an undisclosed amount. The vendor was ING Real Estate.

This new addition to the Encore+ portfolio, which is managed jointly by Aviva and LaSalle, will be the largest logistics property managed by LaSalle in Germany. The property is leased to seven institutional grade tenants. The acquisition will be funded using equity only and is expected to contribute positively to the fund’s distribution yield as well as upweighting Germany in the portfolio.

Bergkirchen is the first acquisition made by the Encore+ fund in four years and follows a phase of intensive asset management. With net inflows now rising, Aviva Investors and LaSalle believe that there will be further opportunities to add to the Encore+ portfolio and are now negotiating on additional assets in the German retail sector.

Commenting on the transaction, Andy Watson, Head of Core, Continental Europe for LaSalle said: 'The last four years for the fund have been a period of disciplined hard work. Sound property fundamentals have enabled us to improve the income profile against an exceptionally tough economic backdrop. Once again, we see good opportunities on the ground to invest in real estate which meets our disciplined acquisition criteria and which is accretive to the fund’s performance. With net inflows to Encore+, we have the capacity to make further investments over the short and medium term and we are actively targeting German retail providing robust income.'

The buyer’s legal adviser was Heisse Kursawe Eversheds and the seller was represented by Schiedermair.

Encore+ is an open-ended fund investing in a diversified portfolio of commercial property across Continental Europe. The fund was launched in June 2006 and is a monthly priced and monthly dealt Luxembourg based FCP. The fund has a gross asset value of EUR 645 mln (as at 31 May 2012) and has a property portfolio of 10 assets across continental Europe including France, Germany, Sweden, the Netherlands, Italy and Spain.