Raven Russia buys warehouse project in Moscow

Warehouse specialist Raven Russia has agreed to buy Karta Realty, the owner of the Southgate warehouse project in the Domodedovo district of Moscow, for $54.5 mln (EUR 39.5 mln). The Southgate project is located close to the international airport and comprises a Grade A warehouse complex of 76,550 m2, which is 88% let to John Deere, and 88 hectares of permitted land capable of producing a further 440,000 m² of completed logistics space once fully developed.

Raven Russia said in a press statement on Monday that the gross value of the property and land is $99.3 mln. The transaction includes debt facilities of around $43.5 mln with Unicredit. The facilities are for a five-year term from December 2006 with a margin of 650 basis points over US Libor. Terms to roll over the facility for a further five years have been agreed with Unicredit, reducing the margin to 430 basis points over US Libor on meeting letting criteria. The purchase price implies an ERV yield of 13.7% on the completed property and a capital value of $840 per square metre. Net operating income on the let space generates $6.4 mln per annum.

Karta Realty Limited is majority-owned by two limited partnerships, one registered in Delaware and the other in England and Wales, managed by Cypress Grove International (CGI). CGI was advised on the deal by Renaissance Capital.

Commenting on the deal, Raven Russia's CEO Glyn Hirsch said: 'This potential acquisition consolidates our position as the major owner and supplier of Grade A Logistics Warehouse space in Moscow. Coupled with our existing Moscow permitted land holdings we now have the ability to bring almost 500,000 m² of completed space into the currently tightly supplied market.'