Fiera Real Estate UK (Fiera) has announced the final close of Fiera Real Estate Logistics Development Fund UK (FRELD).
With the capacity to invest up to €499.8m GDV and with leverage of up to 50%, FRELD’s final capital raise completes subscriptions to its development-led, value-add strategy, which made its debut acquisition in 2022. The fund’s investor base comprises a diverse mix of LGPS and pension funds from the US, Europe, and Asia, as well as proprietary co-investment.
FRELD is already 85% deployed after acquiring ten prime assets in the UK’s leading logistics hubs such as Heathrow, Reading, Cambridge, Hayes and Edmonton. The Fund is actively seeking additional opportunities for small-to-mid box logistics developments of up to 23,226m2 in major metropolitan areas anchored by strategic transport infrastructure, with access to one million people within 45-minute drive time catchments.
Positioned to capture value uplift from ground-up development, FRELD is building highly sustainable assets to a Grade A specification, providing investors with a market-leading, resilient portfolio. All developments target net zero construction, BREEAM ‘Outstanding’ certifications, EPC A ratings, and over 10% Biodiversity Net Gain as part of Fiera’s proprietary Sustainable Design Brief criteria.
FRELD has been able to take advantage of softer pricing conditions in the sector and drive deal flow by leveraging its unique operating partner model. It has a minority stake in nine regional property companies across the country, providing it with hyper-granular origination capabilities and access to off-market opportunities. Together with its operating partner network, Fiera has developed over 100ha of logistics assets with a realised project-level IRR of >50% in the last five years.
Following the successful close of the FRELD, Fiera will start fundraising for its second fund imminently. FRELDII will replicate the strategy adopted in the first fund and target institutional investors globally.
Charles Allen, Head of European Real Estate commented: “The successful close is a vindication of our differentiated strategy and portfolio performance to date, and we look forward to seeing this progress further. We believe our strategy puts us in an excellent position to capture this vintage in UK logistics, which is characterised by strong dislocation from a pricing and supply perspective, as well as surging investor and occupier demand. By leveraging our unique operating partner network and in-house planning and development capabilities, we provide investors with access to superior deal flow and de-risked investments from both a construction and sustainability perspective. Our strict focus on Grade A development in supply-constrained urban conurbations also offers upside through rental growth prospects and comes at a time when early signs of recovery are emerging in the occupational market."
Image Source - Fiera.
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