Verdion acquires new asset in Germany for EUR310 million VELF 1 fund

Pan-European logistics real estate specialist Verdion has added a further asset to its VELF 1 fund, purchasing a 10,200 sq m logistics opportunity south of Leipzig from wholesale business Franz Kerstin.

It is the sixth addition to the fund and part of an acquisition programme focused on value-add potential in strategic locations across Northern Europe. Around half its EUR310 million capital will be allocated to Germany, with the remainder covering the Nordics, Benelux and opportunistic investments in CEE.

The 40,000 sq m site at Patterken 11, 06686 Lützen, is located close to the key motorway A9. It currently accommodates two longstanding tenants in a 10,200 sq m building and offers potential to more than double the amount of industrial and warehouse space within the site boundary.

Starting later this year Verdion will construct a 12,000 sq m modern logistics facility on a speculative basis ready for completion in summer 2022. Verdion will additionally invest EUR10 million in the site for the speculative development as well as partially refurbishing the existing building.

Oliver Kemper, Senior Investment Manager at Verdion says: “This is another attractive acquisition for the fund as part of our ongoing investment programme. Last year Leipzig’s logistics market was the fourth largest in Germany and it is especially dynamic at the moment, due to the availability of labour and overall costs. 

Florian Stöbe, Head of Investment – Germany, at Verdion says: “This leasing profile and capacity for additional development gives us the opportunity to capture potential rental growth in the medium term. At the same time, we are creating long-term value through this new development, which will be built speculatively in response to strong regional demand. The site fits well with the VELF1 strategy of adding value through active asset management as well as additional development, and its location balances other acquisitions in the north, west and centre of the country.”

The deal follows Verdion’s acquisition of a logistics park in Lohfelden near Kassel in February this year, which comprises 16,000 sq m of logistics and industrial and 3,850 sq m of office space across three properties offering potential for the development of a further 8,000 sq m of leasable space. 

Earlier this month Verdion started on site with the latest development of a VELF1 asset in Gallin, near Hamburg, starting to create a 11,800 sq m state-of-the-art facility for fruit and vegetable producer organisation EO Mecklenburger Ernte that will be completed at the end of this year to BREEAM Very Good standard.

REC and GSK advised Verdion. Seller Franz Kerstin was advised by JLL and Rödl & Partner.