Institutional investors within and outside the Asia Pacific region continue to take note of e-commerce trends by investing heavily in the logistics sector.
This past September, Allianz Real Estate, the $63.5 billion property arm of the Allianz Group, expanded its logistics footprint with the group’s first logistics investment in Japan, via a $100 million allocation to Redwood Japan Logistics Fund 2, a develop-to-core, closed-end fund sponsored by ESR and targeting Tier 1 locations. The oversubscribed RJLF2 closed in May 2018 with $575 million, which includes an additional commitment of about $85 million from Allianz Real Estate, as well as investments from the State Oil Fund of Azerbaijan, a fund managed by Aviva Investors, a pension fund based in Southeast Asia, and a German pension fund advised by Mercer.
Until this past January, GIC, Singapore’s $390 billion sovereign wealth fund, was a 36.84 percent stakeholder in GLP before GLP went private after undertaking a strategic review requested by GIC in late 2016.
And in June of 2017, affiliates of the $900 billion China Investment Corp agreed to buy Logicor, Blackstone’s Pan-European logistics company, for €12.25 billion ($14.28 billion). This past December, news outlets indicated a Blackstone real estate fund would take a 10 percent stake in Logicor, and CIC hired Blackstone to manage the Logicor portfolio.
Rapid urbanization, in countries such as China and India, is aiding the growth of e-commerce, with modern logistics facilities benefiting from that growth and capturing the attention of institutional investors. According to the National Bureau of Statistics of China, online retail sales in the country reached $307 billion in first quarter 2018 and accounted for 21.4 percent of total retail sales.
In November 2017, LOGOS Group closed LOGOS China Logistics Venture 3, its third logistics venture in China, with up to $830 million in investment capacity; Ivanhoe Cambridge and PFA Pension, investors based in Canada and Denmark, respectively, are equal partners in the venture. The venture is focusing on high-quality logistics facilities in four regions, covering north, east, south and midwest China, extending the LOGOS China investment mandate beyond Greater Shanghai.
In May 2017, the C$356.1 billion ($274.3 billion) Canada Pension Plan Investment Board committed an initial $500 million for a significant majority stake in the “IndoSpace Core” joint venture with its partner IndoSpace (itself a joint venture between Mumbai-based Everstone Capital and U.S.-based Realterm) to acquire and develop modern logistics facilities in India. IndoSpace Core plans to acquire 13 well-located industrial and logistics parks, totaling roughly 14 million square feet, from current IndoSpace development funds. The prime industrial assets are located in the top industrial and logistics hubs in India, including Bangalore, Chennai, Delhi, Mumbai and Pune.
Ivanhoe Cambridge also partnered with QuadReal Property Group and LOGOS India (a partnership formed in August 2017 between LOGOS Group and Assetz Property Group) for up to $800 million to develop and own high-quality, modern logistics facilities in targeted Indian cities.
