Ivanho茅 Cambridge and Macquarie鈥檚 investment in Australia鈥檚 Logos Property Group could boost the company鈥檚 portfolio to as much as AUD5bn (鈧�3.4bn).
John Marsh, Logos joint managing director, told IPE Real Estate the company鈥檚 two new partners were setting their sights on creating a logistics portfolio valued at up to AUD5bn in the medium term.
鈥淚vanho茅 Cambridge is now part of our management team and will be involved with the growth strategy of Logos,鈥� he said.
鈥淢oving forward, our plan is to create a strategic alliance and management platform to expand across Asia Pacific.
鈥淭wo to three years from now, we could have a very big portfolio of AUD4bn-5bn.鈥�
Ivanho茅 Cambridge, a subsidiary of the Caisse de d茅p么t et placement du Qu茅bec, and Macquarie Capital agreed to become strategic partners in Logos .
The transaction gives the new partners access to a portfolio of some AUD2bn of assets in Australia and China.
Marsh said the company had a 鈥渟ignificant pipeline鈥� of opportunities in China, approaching 3m sqm and with an end value of approximately $1.5bn.
He said most of the sites had already been secured, while others have been targeted.
The expansion programme will meet strong demand for logistics facilities to cater for exponential growth of e-commerce in China.
鈥淚 live in China,鈥� Marsh said, 鈥渁nd can see the undersupply in some areas in major tier-one cities.
鈥淭here are not enough facilities for a country with the size of population and economy of China.鈥�
Ivanhoe Cambridge previously participated in a logistics club venture in China with Logos, alongside Global Investors.
The trio invested $400m in the venture, set up in .
The three partners recently bought the Oxford Cold Storage asset in Melbourne in a deal worth about AUD210m.
Rita-Rose Gagne, executive vice-president of growth markets at Ivanho茅 Cambridge, said: 鈥淲e intend to make further investments in future Logos-managed ventures across the Asia Pacific region, alongside trusted institutional partners.
鈥淲e will continue to support the growth of the platform as a leading Asia Pacific logistics real estate company.鈥�
Brett Robson, Macquarie Capital鈥檚 global head of real estate private capital markets, said Ivanhoe Cambridge鈥檚 endorsement of the Logos platform was an important milestone for the company.
In addition to being its advisor, Macquarie Capital has had a strategic stake in the logistics group since 2014.
Over the past five years, Logos has raised more than AUD1.3bn in equity commitments from sovereign funds and global pension funds.
Just over a year ago, Logos formed a venture with the Abu Dhabi sovereign fund, ADIA, to develop logistics assets in Australia 鈥� in New South Wales, Queensland and Western Australia.
鈥淎DIA is looking at establishing a significant presence in Australia,鈥� Marsh said.
鈥淲e are progressing with the acquisition of key land banks in major industrial precincts in Australia.鈥�
ADIA has a develop-and-hold core strategy for Australia.
Malaysian pension fund KWAP (Kumpulan Wang Persaraan) enlisted Logos to purchase four assets in NSW and Queensland for around AUD220m in late 2014.
Logos was founded in 2010 to assist Singapore鈥檚 sovereign wealth fund, GIC Pte, in its purchase of a portfolio from a Melbourne company known as Salta Properties for around AUD220m.
Subsequently, Logos worked with GIC to grow that portfolio.
GIC sold the portfolio, including other assets, to another Singapore group, Ascendas, for around AUD1.1bn, setting a new record for yield on an industrial portfolio.
鈥淲e continue to have a great relationship with GIC, and perhaps they might come in with us again if we can identify something of interest鈥� Marsh added.
