UBS Asset Management's (UBS-AM) Real Estate & Private Markets (REPM) business has completed the acquisition of the PP10 Warehouses, two core logistics assets located in Madrid, Spain. The assets were acquired by REPM’s Iberian team on behalf of a separate account client from Invesco Real Estate for €35.15m.
The two core logistic assets total 34,968 m² and have been acquired 100% let, with a sole tenant occupying each of the properties. Constructed in 2008 to the highest specifications and well maintained since, they stand in prime condition comprising a mix of flexible warehouse and office space, with high provisions of loading docks and car parking to the exterior of each site.
Warehouse 1, the larger of the two properties, has a GLA of 20,468 m² and has been occupied by CADYSSA, regarded as one of the largest distributors of cosmetics in Spain, as its national headquarters since the asset was built. The 14,500 m² Warehouse 2 is occupied by XPO Logistics, the international logistics operator, also since completion of the asset in 2008. Together, the two properties should provide stable long-term income streams owing to both their attractive weighted average lease term of 17 years, and strong covenants.
PP10 is located in Leganes, one of Madrid’s most consolidated distribution and logistics submarkets, 11 kilometres outside of the capital. Situated adjacent to the M50 ring road which surrounds the city and connects to a number of major motorways, PP10 offers an unrivalled location for local and national operators, while also being just 40 kilometres from Madrid Barajas International Airport.
This acquisition is directly in line with the client's multi-asset class strategy on a pan-European scale and represents their first logistic investment. The acquisition also provides a competitive exposure to the recovering Spanish economy, and is coupled with a positive outlook for the logistics sector in Madrid. These properties bring REPM’s assets under management across the Iberia business to circa €675m. REPM has operated in Iberia, including Spain and Portugal, since 2003 and currently manages seven funds or separate account mandates with a portfolio of assets across the office (59%), logistics (7%) and retail (34%) sectors.
