Carlyle and Townsend to invest USD200m in Chinese logistics warehouses
The Carlyle Group and The Townsend Group have partnered with Shanghai Yupei Group, one of the largest logistics warehouse developers in China, to invest in 17 modern warehouses in China.
Carlyle and Townsend will commit approximately USD200m to acquire equity interests in five warehouses owned by Shanghai Yupei Group and to build 12 new warehouses in the next two years.
Shanghai Yupei Group will also invest USD200m, bringing the total equity commitment of the strategic partnership to USD400m.
The 17 warehouses will be located in major logistics hubs across China, including the first-tier cities of Shanghai, Beijing, and Guangzhou, and select second-tier cities such as Shenyang, Tianjin, Chongqing, Zhengzhou and Hefei. Upon completion of its investment plan, the strategic platform expects to own and operate a nationwide logistics warehouse network with more than 1.8 million square metres of gross floor area to serve a diverse range of tenants.
Jason Lee, managing director and head of Carlyle Asia real estate, says: “Modern logistics is a nascent but fast growing industry in China, supported by strong growth in domestic consumption, exponential expansion of e-commerce and favourable government policies.
"We are attracted to the logistics warehouse sector in China by its favourable demand and supply fundamentals, and we are excited to work with Shanghai Yupei Group, one of the most experienced and highly regarded domestic logistics warehouse developers in China, to build a nationwide network of high quality warehouses.”
Nicholas Wong, principal of The Townsend Group, says: “Townsend views the growth of modern logistics to be a compelling secular investment theme in China, and around the globe. We are pleased to partner with The Carlyle Group and Shanghai Yupei Group, an experienced logistics developer and operator, to bring this unique investment opportunity to our clients.”
Shifa Li, chairman of Shanghai Yupei Group, says: “The investment by Carlyle Asia Real Estate is a strong vote of confidence in our business model and execution capabilities. We have a strong pipeline of development projects in major logistics hubs in China. The capital injection will allow us to further speed up land acquisitions and construction, and to quickly expand our geographical coverage to better serve our tenants.”
Carlyle’s share of the equity will come from Carlyle Asia Real Estate (CARE), which invests in value-add opportunities across all real estate sectors in Asia, as well as in core assets on behalf of separate accounts. With local teams based in Hong Kong, Shanghai, Singapore and Tokyo, CARE has committed an aggregate USD2.2bn of equity in Asia. In China, CARE has made 15 investments with an expected total capitalisation of USD3.1bn.