Singapore-listed Global Logistic Properties (GLP), owner of 55 million m2 of logistics space in Asia and the US, has emerged as the buyer of European logistics group Gazeley for around $2.8 bn (€2.4 bn).
GLP is being privatised following its acquisition by Chinese private equity firms and the state-owned Bank of China in July of this year. The company said the Gazeley deal marked its entry into Europe and provides it 'one of the highest quality portfolios in Europe as well as an experienced local management team with a strong development track record'.
The Asian investor had previously tried to buy P3 but was beaten to the punch by Singapore's sovereign wealth fund GIC.
'We have been looking to expand to Europe and this portfolio presents anattractive entry point given the quality and location of the assets,' commented Ming Z. Mei, co-founder and CEO of GLP. 'This transaction adds a premier operational and development platform for us in Europe and is part of our long-term strategy to expand our fund management business.'
Owner Brookfield appointed Morgan Stanley as well as CBRE earlier this year to handle the sale of Gazeley with a price tag of around €1.7 bn.
GLP said it intends to add the Gazeley portfolio to its fund management platform. Investor demand to partner with GLP in the European logistics market is strong and the company is already in negotiations with interested capital partners, it added.
GLP intends to retain the existing management team and the Gazeley brand. Gazeley's portfolio encompasses 3 million m2 concentrated in Europe’s key logistics markets, namely the UK (57%), Germany (25%), France (14%) and the Netherlands (4%). It comprises 1.6 million m2 of existing assets, which are 98% leased with a weighted lease expiry of nine years, and a development pipeline of 1.4 million m2 buildable area.
Approximately 60% of existing assets have been built within the last five years and 85% of the development pipeline is focused in the UK.
The transaction will be funded by $1.6 bn (€1.4 bn) of equity and $1.2 bn (€1.0 bn) of long-term, low-cost debt.
The deal marks the third-largest this year in the booming European logistics sector after CIC's acquisition of Logicor. In June, Blackstone confirmed the sale of its European logistics platform, Logicor, to China Investment Corporation (CIC), for €12.25 bn - the largest real estate investment transaction ever in Europe.
In January, Singapore's GIC completed the purchase of P3, the pan-European owner, developer and manager of logistics properties, from TPG Real Estate and Ivanhoé Cambridge for €2.4 bn.
