M&G invests EUR80m in Spanish acquisitions
M&G Real Estate has invested a further EUR80 million in European commercial and industrial property, with the acquisition of two industrial and two retail assets in Spain, made on behalf of the M&G European Property Fund managed by David Jackson and Simon Ellis.
With a focus on prime real estate in core locations and with strong long-term income growth prospects, each asset acquired has a compelling case for investment.
The two retail acquisitions are H&M Reyes Catolicos in Granada and Gran Via 68 in Madrid. Totalling 3,668 sq m, both sites are located in prime retail districts in their respective cities, leased to successful national and international brands; fashion retailer H&M in Granada, and Tony Roma´s restaurant and bank Banco Sabadell in Madrid respectively.
In addition, M&G Real Estate has acquired two industrial sites in Madrid: Teka Logistics Platform close to the A2 highway in the north, and a further asset in the prime Getafe logistics corridor to the south of the capital. With a combined size of 55,092 sq m, each asset is conveniently located to deliver on the increasing demand for last-mile logistics in the Madrid metropolitan area.
Jackson says: “Our latest research suggests the Spanish economy will continue to perform well, with its recovery having accelerated in 2017. This extends to the commercial real estate market, where we predict average rental growth in both industrial and retail will range between three and four per cent per year for the next three years in Madrid.
“These new acquisitions fit perfectly with our strategy to increase our exposure to Continental Europe by investing in core assets in strong growth markets. We see a strong correlation between the level of rental growth and tourist spend in major tourist destinations across Europe; Madrid and Granada are very good examples of this trend.”
Federico Bros, Director of Asset Management, Spain and Portugal, adds: “We have seen strong demand for high street retail in prime locations across Spain. Both of the retail sites we have purchased are in established locations and offer great rental growth prospects. The industrial sector in Spain also offers strong rental growth prospects as online activity accelerates and these acquisitions help us diversify our portfolio in key sectors.”
The EUR3 billion M&G European Property Fund was launched in 2006, with a mandate to invest in a globally diversified portfolio of assets in mature European markets outside the UK.
Optimus Global Investors brokered the deal for Gran Via 68 and CBRE acted on behalf of M&G Real Estate in the acquisition of Teka Logistics Platform.