Clarion Partners Europe, formerly Clarion Gramercy, has enhanced its footprint in Spain by 1.4 million square feet in one fell swoop. The logistics-centric real estate investment fund manager has recently acquired a group of four industrial warehouses located in key logistics markets in the Barcelona and Seville regions from Prologis Inc. Neither Clarion Europe nor Prologis disclosed the financial details of the transaction; however, according to an article by IPE Real Estate, Clarion Europe paid nearly €90 million, or approximately $106.6 million, for the portfolio.
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The majority of the institutional grade assets are sited in the Barcelona area and include an approximately 454,800-square-foot, two-unit property in Constanti, a 279,500-square-foot warehouse in Valls and a facility in Saint Esteve consisting of two units totaling 125,000 square feet. The largest property, a 555,200-square-foot warehouse, is located in Dos Hermanas, the main logistics hub of Seville.
The portfolio’s tenant roster includes include two third-party logistics providers, as well as subsidiaries of an American multinational food manufacturer, an automotive seating and electrical systems manufacturer and a French multinational retailer. Together, high-growth e-commerce and grocery operations account for 88 percent of the portfolio’s income. While the group of properties is currently fully occupied, Alistair Calvert, CEO of Clarion Partners Europe, noted in a prepared statement that the collection offers upside potential in the form of lease rollover.
Clarion Europe, which is the European arm of New York-based Clarion Partners LLC, acquired the warehouses on behalf of one of its comingled funds. With the completion of the Prologis transaction and the purchase of a new 400,000-square-foot warehouse in the Madrid area in September, Clarion’s logistics portfolio in Spain has ballooned in just two months from 1.3 million square feet to 3.2 million square feet spanning 14 assets in metropolitan Barcelona, Madrid and Seville.
Lively time for logistics
While global commercial real estate activity is just starting to pick up again following several months of investors taking a wait-and-see approach, while the world grappled with the COVID-19 pandemic, Clarion Europe has remained active all year, and for good reason: The European logistics sector is thriving. “Banks’ willingness to lend to prime logistics schemes is continuing to support values, and structural changes supported by rising e-commerce penetration during Europe’s second wave of coronavirus is supporting capital value growth,” according to a November 2020 report by Savills. “Buyers also favor the demographic argument with further urbanization forecast across Europe’s key cities over the next 10 years and rising online sales.”
Clarion Europe has invested nearly €300 million, or approximately $355 million, in existing assets and development projects in Spain, France and the Netherlands year-to-date. Additionally, in October, the company entered into a strategic partnership with Bouwinvest Real Estate Investors and an unidentified institutional real estate investor to invest €300 million in value-add logistics properties and ground-up developments in key locations across Continental Europe.