M7 Real Estate (“M7”), the pan-European investor and asset manager, announces the acquisition of a portfolio of four industrial and logistics assets across France for c. €80 million. The transaction was undertaken on behalf of the European Supply Chain Income Partnership (“ESCIP”), a pan-European industrial and logistics investment vehicle backed in joint venture (the “JV”) by M7’s owners Oxford Properties, a leading global real estate investor, developer and manager, and AustralianSuper, Australia’s largest superannuation fund. The portfolio has been acquired from a 90/10 joint-venture formed respectively by PGIM Real Estate’s European Core Plus strategy and Alderan, a leading French real estate management company.
The JV was formed through the acquisition by AustralianSuper of a 50% stake in Oxford’s c. €840 million industrial and logistics portfolio and its M7 platform, which was announced in January and formally completed in April. This is the first transaction undertaken by M7 since that completion, with ESCIP targeting a €4.5 billion portfolio over the next three to five years. Importantly, this also marks the JV’s first acquisition in continental Europe, reflecting its strategy to scale across key logistics markets in the region.
The c. 109,000 sq m portfolio is 83% let and is strategically located in established distribution hubs across France, including Lyon, Marseille, Nancy and Angers. Key occupiers include ID Logistics and Pomona EpiSaveurs and the portfolio presents an opportunity to refurbish and lease up the vacant space, improve the sustainability credentials and to grow the income profile.
This is M7’s third investment on behalf of the ESCIP platform following two acquisitions in the Greater Manchester area earlier this year totalling ~£60 million.
John Pow, Managing Director at M7 Real Estate, commented: “Following the completion of Oxford and AustralianSuper’s joint venture earlier this year, we are now focused on executing our growth strategy for the platform. This milestone transaction underscores our conviction in the sector and our view on the French market, as we look to scale the JV’s portfolio and continue deploying capital into high growth markets across the UK and western Europe.”
“Our immediate focus is on undertaking our property level asset management plans, leveraging M7’s expertise and on the ground presence to capitalise on the continued demand for logistics space in the French market.”
Alicia Peters Vice President, Industrial & Logistics at Oxford Properties, commented: "Having partnered with AustralianSuper at the beginning of the year to grow the ESCIP portfolio and the M7 Real Estate platform, this first acquisition in Europe is an important step in achieving that goal while giving us exposure to key French logistics markets outside of Paris which complement our existing portfolio. This transaction underscores both M7’s ability to source and execute the acquisition of high quality, well located assets across Europe and reflects our continued conviction in the industrial and logistics sector."
Matthew Fidge, Investment Director at AustralianSuper said: "We are very pleased to announce the first transaction since the completion of the joint venture between AustralianSuper and Oxford Properties. This portfolio acquisition highlights our conviction in our European multi-let logistic strategy, as well the benefit of the M7 Platform’s established capability in the French market. AustralianSuper looks forward to working with our partners to deliver attractive risk-adjusted returns for our members, and are ambitious to continue this momentum as we seek to further scale the ESCIP portfolio alongside the Oxford and M7 teams."
Nabil Mabed, Head of France, Spain & Portugal at PGIM Real Estate added: “We acquired this portfolio in an off-market transaction during COVID in 2020 and have created significant value through asset management hand in hand with our operating partner Alderan. We are happy to complete a strong exit for our European core plus strategy in a market where overall transaction volumes are still low. This is a demonstration of the resilience of the French logistics market and of the quality of the portfolio which has a potential for further value creation under M7’s ownership.”
