Oxford Properties has joined forces with logistics specialist Logistics Capital Partners (LCP) to acquire a 15-acre site in Heathrow, London for an undisclosed amount.
Oxford’s acquisition marks its first direct logistics investment in Europe, with plans to redevelop the site to provide a purpose-built prime logistics space.
Oxford secured the transaction with LCP, and has retained the firm as investment, asset and development manager for the scheme over the following years. The venture intends to deliver a technologically advanced and environmentally sustainable development to the east of London Heathrow Airport.
Oxford manages a £4.7 bn global portfolio of industrial real estate exposure across North America, Europe and Asia Pacific. Oxford has had exposure to European logistics since 2018 through its investments into indirect logistics vehicles with assets in the UK, Germany and France.
Over the past two years, Oxford has built and invested in best-in-class logistics platforms across the globe to substantially increase its weighting to the sector.
Oxford said that it intends to deploy £3 bn of capital in the European logistics sector over the next five years in platforms and portfolios of scale. The sector is expected to grow to represent a third of the firm’s property assets in the future, up from just 4% two years ago.
Jo McNamara, head of Europe at Oxford Properties, commented, ‘Logistics continues to be one of our highest conviction strategies globally; we continue to believe in the secular shifts underpinning the sector, including e-commerce penetration and evolving supply chains, that will continue to drive robust occupier demand against a limited supply of prime new space. This demand and supply imbalance for new, prime logistics space is particularly apparent around major cities where there is significant competition from alternative uses.’
James Markby, managing director at LCP added, ‘This rare strategic site, with Oxford Properties as a new capital partner, further marks our intentions in the UK. It was undertaken during a challenging Covid-19 operating environment, and is a perfect illustration of our platform and capabilities across the seven countries we operate in. We continue our growth with an additional 14,000,000 sq ft (1,300,000 m2) of new construction projects to be launched and announced in the coming year.’
