VGP, the European logistics real estate developer, has entered into a €500m 50/50 joint venture with Allianz Real Estate. The deal represents one of the largest specialist logistics and industrial real estate agreements of its type in Europe.
The new partnership will act as an exclusive take-out vehicle of the income generating assets developed by VGP and located in Germany, the Czech Republic, Slovakia and Hungary.
JLL supported VGP in the creation of the JV and the search for an appropriate equity partner to secure a platform aimed at continued growth across target European countries, including Germany, Czech Republic, Slovakia and Hungary. According to VGP, Allianz Real Estate will become a long term investor with the necessary financial resources to co-invest in the expansion of the logistic and semi-industrial real estate portfolio.
“We are delighted to have found a strong and reputable partner in Allianz Real Estate. With the joint venture we can consistently continue our growth from the last few years. At the same time, our company will retain decision-making power about new developments,” said Jan Van Geet, CEO of the VGP Group. “Like us, our joint venture partner is also committed to a long-term perspective and wants to grow with us. We want to convince our current tenants and potential new tenants of the quality of our products and the advantages of a collaboration. Together with Allianz Real Estate, this will be even more successful and dynamic in the future than it has been in the past.”
VGP and Allianz aim to grow the joint venture exponentially (> € 1.5bn) by exclusively acquiring income generating assets developed by VGP in the aforementioned geographic areas. The transaction ends a 24 month strategic exercise of VGP and will have a significant impact on the structure and evolution of the VGP Group for the future. The transaction allows VGP to further concentrate on its core development activities aimed at optimising shareholder value, without having to tap the capital markets
“This transaction highlights the continued demand for high quality, well located logistics assets across Europe and the desire to find a best-in-class partner to work alongside. Investment volumes for European logistics real estate reached €21.5bn in 2015, in line with the record volumes of the previous year, and we expect appetite for logistics product to continue this year. The market is supported by unprecedented levels of occupier demand - over 17 million m2 take up in 2015, a 15% increase year-on-year - and historically low vacancy rates”, commented Tom Waite, director, JLL logistics capital markets.
