Azora Launches a Vehicle to Invest €250M in Last Mile Logistics Hubs

9 January 2019 – Eje Prime

Azora is launching itself into the last mile logistics sector. The real estate manager has launched a vehicle to invest €250 million in premises located in the centre of cities with the aim of facilitating urban distribution and responding to the boom in e-commerce.

According to the company’s plans, the first investments will take place during the first quarter of this year. Azora will be responsible for the vehicle and will hold a minority stake in it. Meanwhile, the consultancy firm CBRE will be responsible for designing it and for supplying the real estate services, according to Expansión.

Until now, Azora and CBRE have identified almost thirty assets that fit their investment objectives until 2021. Currently, both companies are holding negotiations to purchase those properties, which include disused furniture stores, parking lots, dealerships, workshops and shopping centres inside the M-30 in Madrid and within Las Rondas in Barcelona. The properties must also have a surface area of more than 800 m2.

The assets will subsequently be leased to major logistics operators and to other transport companies, as well as to merchants and distribution companies under long-term lease contracts.

With more than €4.5 billion in assets under management, Azora is continuing to back the real estate sector after breaking its alliance with Hispania. Since then, the company has taken advantage of its experience in the sector to back the residential rental segment through the creation of a joint venture with CBRE Global Investment and Madison to achieve a portfolio of 10,000 homes within the next few years.

Original story: Eje Prime

Translation: Carmel Drake

Deloitte: Spain’s Logistics Sector is Hot Property Thanks to the ‘Amazon Effect’

18 May 2018 – Expansión

Investment funds want to take advantage of the collateral effects that the boom in e-commerce is going to have in the real estate market by taking positions in a segment with great potential, namely: the storage of goods and products. The logistics segment has become the “golden girl” of the real estate sector and one of the favourites of investors boosted by strong yields and the expectations of business growth. In this context, Asian investors have placed their focus on the European logistics market.

According to the Logistics Property Handbook compiled by Deloitte, last year, investment in logistics assets in Europe recorded a milestone with €42.5 billion of assets transacted, thanks to mega-operations such as the purchase by China Investment Corporation (CIC) from Blackstone of the Pan-European platform Logicor for €12.2 billion, and the acquisition of the European platform Gazeley by Global Logistic Properties (GLP), headquartered in Singapore, for €2.4 billion.


In Spain alone, investment in logistics assets amounted to €1.63 billion, which represented a 75% increase compared to the previous year, and a historical record, due to significant transactions involving logistics portfolios. CIC’s purchase of Logicor implied a transaction volume of €652 million in Spain. Meanwhile, P3 Logistic Park – owned by the Singapore sovereign fund, GIC – purchased 11 assets from Green Oak in Spain for €243 million. Those operations boosted investment to historic levels.

Moreover, last year, Mango sold its logistics centre in Palau-Solità I Plegamans (Barcelona) to the fund manager Invesco for €100 million. That transaction was the largest involving a single asset in Spain and the fourth-largest in Europe.

According to the forecasts in the report, operations in the pipeline, which may be closed this year, already amount to €980 million.

“The large institutional funds that aspire to lead the logistics sector in Europe and around the world are bidding hard to accumulate the largest logistics surface area possible during this economic cycle. The location and size of their international logistics platforms are the two key variables for exercising greater negotiation power and whereby obtain the highest rents from operators”, explains Javier García-Matro, Partner in Financial Advisory at Deloitte.

Despite the record investment figure recorded last year, the volume of assets transacted in Spain represents just 4% of the total European market. “This fact is proof of the growth potential of these types of assets in our country. In 2017 alone, 865,000 m2 of logistics space was handed over in Madrid, Cataluña and Valencia. The strong demand of the current cycle is causing logistics promoters to develop more than 2 million m2 of land in these markets, in both turnkey and speculative projects”, says García-Mateo.

One of the major players in the sector is the Socimi Merlin, which has placed logistics asset at the centre of its growth strategy. Merlin’s expansion plan involves the development of land and turnkey construction, a roadmap that has allowed it to become one of the leaders in the sector in just four years.

The main players

Merlin has 2 million m2 of logistics land, both in portfolio and under management, and its plans involve increasing that volume to 3 million m2 before the end of the economic cycle. Specifically, it plans to spend around €250 million on logistics development over the next four years.

Another important player is Logicor, the Pan-European platform, which has been controlled by the Chinese group GIC since last year and which owns 1.2 million m2. Meanwhile, the alliance formed by the real estate manager CBRE GI and its local partner Montepino is going to develop a portfolio of prime assets in the main geographic areas of Spain with a planned investment of around €300 million.

They are joined by the European giants Prologic and the platform P3 Logistic Parks, which own 900,000 m2 and 400,000 m2, respectively, as well as the European investment group VGP, which owns almost 400,000 m2 of logistics space in Spain.

In terms of the types of assets, the Amazon effect has revolutionised the industrial sector and forced logistics operators to reinvent themselves to adapt to the new needs of clients (…).

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Logistics Space: Demand Rose In Madrid & Barcelona In 2016

16 January 2017 – Inmodiario

Barcelona is breaking records in terms of the volume of space being leased; Madrid is improving its absorption rates compared to 2015; and both Madrid and Barcelona are resuming activity involving higher risk developments. Both cities are benefitting from the economic recovery.

410,000 m2 of logistics space was leased out in Madrid in 2016, whereby exceeding the volume leased out in 2015 (385,000 m2). This trend reflects the context of improving retail sales and internal consumption.

Demand in the capital centred around the A-2 and A-4 motorways – the latter stood out the most during the fourth quarter as it accounted for three quarters of the absorption seen during that quarter (126,000 m2), which in turn accounted for a third of the space leased during the year (410,000 m2).

39 new lease contracts were signed during the year, of which 6 were major operations covering a surface area of more than 15,000 m2. The trend was similar to that seen in 2015, in terms of both the total number as well as the size of operations. This confirms that the major operators and logistics users are concentrating their activity in the large logistics hubs.

We also highlight the new higher risk developments, in other words, those that do not have pre-agreed tenants, given the lack of available quality and the obsolescence of existing warehouses. In recent years, operators have been leasing the highest quality warehouses, which means that those left available do not fulfil minimum requirements.

(…) Almost 350,000 m2 of new build logistics space is expected to be constructed in 2017, with almost 100,000 m2 as turn-key or pre-lease projects.

Prime rents amounted to around €5/m2/month in Madrid in 2016 and are expected to rise, given the shortage of available modern space and the added values that the warehouses that are going to be opened in 2017 are expected to offer. (…).

The leasing of logistics space in Barcelona exceeded the record set in the previous year, to reach 645,000 m2.

That figure represents a YoY increase of 17% if we compare it with data at the end of the previous year (…).

The main operations included in this figure are: the new logistics centre that Amazon plans to inaugurate at the end of 2017 in El Prat de Llobregat, which will have a surface area of more than 63,000 m2. It also includes Mango’s leasing of space in Lliçà covering a surface area of 119,000 m2. (…).

Prime rents in Barcelona now stand at €6/m2/month, whereby returning to 2009 levels, having increased by 9% in 2016, due to the lack of Triple A product and the increase in demand from the main operators. (…).

Original story: Inmodiario

Translation: Carmel Drake

Metrovacesa Sells 16 Logistics Warehouses To CBRE GI

11 April 2016 – Expansión

The company has decided to focus its activity on the operation of its portfolio of commercial and office buildings.

Metrovacesa has sold a batch of 16 logistics warehouses located in one of the country’s main hubs, next to the A-2 Madrid-Barcelona motorway, to the real estate asset manager, CBRE Global Investors.

The real estate company, controlled by Santander, has described the operation as the divestment of assets from its real estate portfolio that it considers are non-strategic.

The batch contains 16 logistics warehouses with a combined surface area of 250,000 m2, which are leased to a dozen logistics operators, including FM Logistics and Luis Simoes.

The asset manager CBRE Global Investors said that it has acquired this batch of real estate assets on behalf of one of its main clients, which is investing in logistics warehouses across Europe.

Metrovacesa is currently focusing its business on operating its portfolio of commercial and office buildings, which it recently expanded through a non-monetary capital increase in which Santander and the real estate company’s other shareholder banks contributed a batch of office buildings worth around €1,000 million.

Original story: Expansión

Translation: Carmel Drake

Merlin: The Strong RE Inv’t Figures Will Not Be Repeated In 2016

26 February 2016 – Invertia

In the context of the 2nd Meeting of the Real Estate Sector, organised by the IESE business school, Ismael Clemente (pictured above), the President and CEO of Merlin Properties, explained that the investments made in recent years have been due to the improvement in the economic situation, following years of recession.

In any case, Clemente has said that “we are seeing good things in the market”, but we need to “good governance of the country” to confirm the trend.

“It seems like there is little hope for 2016. We would like our political leaders to have a sanity attack and start reaching agreements”, he said.

With regard to this political instability, he has said that some companies “cannot wait” for the situation to be resolved.

When asked about the future of the sector, Clemente forecast a “slight decrease” in demand for offices and explained that companies depend on the fact that “a proportion of their employees are ‘floating’”, which leads to situations of “overbooking”.

“There are companies with 1,400 employees looking for spaces for 1,000 employees”, he said.

Regarding the refinancing of Testa, Clemente criticised the change in the value of the risk premium, and explained that “the widening of 50% of the risk premium is not good business for anyone”.

In terms of new technologies and the changes that they may generate in the real estate market, Clemente explained that Merlin wants to increase its portfolio of logistics facilities in Spain’s main hubs with a view to supporting the growth of online businesses.

Meanwhile, he also pointed out the (wider) need to adapt to new technologies: “Either we start to adapt ourselves now, in the form of training, or we will end up with the destruction of lots of jobs and, therefore, with fewer consumers”.

Original story: Invertia

Translation: Carmel Drake