SEGRO has acquired the remaining 50 per cent interest in the Logistics Property Partnership (LPP) joint venture from Moorfield Real Estate Fund II (MREF II) for GBP95.6 million.
LPP was established in January 2012 by SEGRO and MREF II as a 50-50 joint venture to acquire the UK Logistics Fund and was jointly managed by SEGRO and Moorfield Group.
The portfolio comprises 12 high quality logistics warehouses totalling 377,000 sq m, predominantly located in the South East and Midlands. Customers include major retailers and logistics providers including Sainsbury’s, Tesco, Booker, Royal Mail and DHL.
SEGRO’s chief executive officer, David Sleath, says: “This transaction provides us with a rare opportunity to acquire, off-market, a portfolio of high quality UK logistics assets with a strong customer line-up. We know the assets well, having successfully executed a number of asset management initiatives within the joint venture, including letting up all the space which was vacant at the time of acquisition. With occupier demand for logistics in the UK improving and supply conditions remaining tight, there are opportunities to realise further value from this attractive portfolio.”
Marc Gilbard, chief executive officer at Moorfield Group, says: “LPP has proven a successful partnership and investment for MREF II and the sale provides a healthy return, complementing the disposals of other fund investments. The MREF II/SEGRO partnership has achieved ahead of business plan what we wanted from it following a number of material asset management successes across the logistics portfolio that includes the successful letting of over 900,000 sq ft this year. MREF II now leaves the LPP partnership investment, with all units in the portfolio fully let. Despite our exit, the market for logistics warehouses remains strong and we will continue to look for investment opportunities in this sector.”