UK fund manager Morley and Munich-based SachsenFonds have teamed up again to launch a new logistics and industrial property fund to 'capitalise on the active and growing logistics market in Continental Europe'.

UK fund manager Morley and Munich-based SachsenFonds have teamed up again to launch a new logistics and industrial property fund to 'capitalise on the active and growing logistics market in Continental Europe'.

Morley, the fund management arm of UK insurer Aviva, said the fund, Logaxes, will hold approximately 60% of its assets in the core German and Austrian logistics and industrial markets. The remainder of the portfolio will de diversified across the 'growth markets' of Poland, Hungary, Slovakia and the Czech Republic. The fund has already received equity commitments of EUR 42 mln and aims to raise a total of EUR 157.5 mln.

Florian Geistmann, head of real estate acquisitions at SachsenFonds, said: 'We aim to build a EUR 450 mln portfolio of high-quality logistics assets, of which EUR 63 mln has already been invested in four assets based in Slovakia and Austria.'

Geistmann added that two further assets were committed for EUR 43 mln in the Czech Republic and Austria, and the fund has a strong pipeline of acquisition opportunities with a number located in Germany. SachsenFonds, which is owned by German property fund manager Kanam and manages EUR 4.7 bn in assets, has worked with Morley previously on other funds.

Logaxes' fund manager Andrew Hook of Morley noted that the economic centre of the EU has moved eastwards due to the enlargement of the Union. 'Logaxes is well positioned to take advantage of this eastwards shift in transport axes, along with continued growth in the European logistics sector. The European logistics sector is much less mature than the US and UK markets, and is also supported by a strong trading environment.'

'While owner-occupier rates in Europe are currently high, companies are increasingly outsourcing their logistics arrangements to third-party specialists, creating a knock on demand for high-quality logistics warehousing.'

The fund is targeting a unitholder internal rate of return of between 9-10% per annum over the 10-year life of the fund.