GIC ramps up interest in Europe logistics properties, Real Estate

Mon, Nov 16, 2020 – 4:56 PM

GIC has entered into a joint-venture agreement with Europe’s Melcombe Partners to acquire and develop urban logistics properties in Europe.

The venture will acquire and develop last-mile distribution centres and urban logistics assets well-located in Europe’s main gateway cities, with a focus on the UK, France, Germany, Spain and the Netherlands, GIC said on Monday.

Melcombe will source, operate and manage the assets. No deal value was provided.

In a media statement, Ludovic Bernard, partner, Melcombe Partners, said the venture can unlock the “full potential of the fragmented European urban logistics markets”.

The factors underpinning the sustained growth of the sector include spiking e-commerce activity, tightening supply of logistics space in large European cities, restrictive land planning rules, and increased focus on global supply chain resilience, he said.

Lee Kok Sun, chief investment officer of real estate, GIC, said this venture reflects GIC’s continued confidence in the long-term potential of the logistics sector.

“The urban logistics sub-market will benefit from positive fundamentals, reinforced by increasing occupier demand due to accelerating e-commerce adoption and changing supply chain management strategies. We believe the venture’s focused strategy, with the management of a skilled partner such as Melcombe, will generate resilient returns in the long run.”

The latest deal comes amid sustained interest from GIC in the logistics segment in Europe. Blackstone and GIC are reportedly eyeing Polish postal locker firm InPost.

GIC’s wholly-owned unit, P3 Logistic Parks, had also earlier agreed to acquire 33 retail logistics assets in Germany. The real-estate portfolio is in prime urban locations in major German cities and towns, and spans over 650,000 square metres of space, GIC said in October. GIC did not reveal the value of the acquisition.

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