Lineage Logistics Raises $1.9B in Equity

Pago facility. Image courtesy of Lineage Logistics LLC

In yet another sign of the industrial real estate sector’s strong appeal among the investment community, Lineage Logistics LLC has just completed raising $1.9 billion in equity commitments. For Lineage, which is the largest temperature-controlled industrial REIT and logistics solutions provider in the world, the massive amassing of funds marks the largest equity raise since the company’s 2008 founding.

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Lineage’s announcement comes on the heels of the REIT having raised $1.6 billion in September 2020. The new equity raise attracted new and existing strategic partners, including D1 Capital Partners, Oxford Properties, CenterSquare Investment Management, MS Tactical Value, Conversant Capital and OP Trust. Real assets specialty manager Cohen & Steers Inc. made another commitment after having invested $100 million on behalf of its mutual funds in the September fund raise. BentallGreenOak, which also participated in the September fund raise, became one of Lineage’s largest investors with its equity investment in the most recent fund raise.

Fulfilling goals

Lineage plans to utilize a substantial amount of the new equity to continue making strides in its strategy of transforming the global food supply chain to eradicate waste and help feed the world by investing in disruptive technologies for temperature-controlled warehouses.

The company will direct additional equity toward financing greenfield development and facility expansion endeavors in key locations around the world. Lineage’s lengthy list of pending or recently completed projects spans sites across the U.S., as well as in Denmark, Poland, Vietnam, New Zealand and in the U.K., where expansion projects at the company’s London-area facility in Peterborough and its Manchester-area facility in Heywood are scheduled for completion this month. Finally, Lineage will continue its M&A activity, seeking best-in-class cold chain companies across the globe. In December, the REIT expanded its European footprint by entering the Polish market with the acquisition of Pago Sp. z o.o., the largest cold storage and logistics provider in the country.

Indeed, demand for cold storage is on the rise. Emergen Research noted in a recent report that the global cold storage construction market size is forecasted to grow in value from approximately $7 billion in 2019 to $18.6 billion in 2027. “Market revenue growth is primarily driven by increasing online grocery sales in developed and developing economies, and rising preference for online shopping owing the pandemic and expanding e-commerce channels. Rapid growth in online grocery sales has also resulted in need to expand cold storage facilities and a shift towards larger and more industrial-type cold storage facilities,” according to the Emergen Research report.