The Australian company, Goodman Group, announced it has set up two new relationships with CBRE Realty Trust in the UK and Europe worth A$ 1.3 billion. The co-investment vehicles are expected to invest in pre-committed logistics development opportunities to be sourced via Goodman and funded on an 80/20 basis, with CB Richard Ellis Realty (CBRE) Trust taking the majority share.
In the plan, the planned UK co-investment vehicle is expected to target a total investment of £400 million over an initial three year investment period, and additionally include the acquisition of two assets in the UK from Goodman for an estimated sum of £22.4 million. Further more; the company would have a right of first refusal over logistics properties developed by Goodman in the UK.
On the other hand, other than the UK investment, the company’s European investment would target a total investment sum of €400 million over an initial investment period of three years, to be centered on Western European markets of Germany, France and Benelux. Goodman European logistics fund (GELF) has a right of first refusal over developments to be taken by the group. The co-investment vehicle, will however, have the right of second refusal that it will exercise where developments offered to GELF have been declined.
Goodman CEO, Greg Goodman, said the initiative would allow the company to continue building momentum across Europe with its focus mainly being on building strategic relationships with leading global investor groups, such as CBRE, to help the company deliver on its key aim of matching new third party capital with Goodman’s development pipeline.
Goodman has A$ 7 billion development fund set for the UK and Europe, aimed at offering expansion advantages to its current operating platform. In the UK alone, the Goodman Group has about A$ 0.9 billion of logistics assets and development land, and hopes to further diversify its UK logistics investment portfolio with this new venture. The Company is very well positioned to take advantage of the improvement in the prime logistics markets in the UK, given lower competition and a well established blue chip customer base.
The company said it would mainly aim at acquisition of high quality logistics investments that will give the company a strong base for its development, expansion and UK business. The company’s managing director of UK logistics said he was happy to deliver on its strategic aim of creating new UK logistics Co-investment Vehicle through partnering with CBRE. Goodman will provide asset management, development and property services to the Co-Investment Vehicles on terms generally consistent with existing arrangements across Goodman’s funds management platform.
June 15, 2010.