Global real estate investment company Kennedy Wilson has acquired a high-quality, diversified portfolio of 20 UK urban logistics assets totalling 1.3 million square feet, via an off-market transaction with UK logistics specialist, Leftfield, for £220 million. Kennedy Wilson has a 20% ownership in the portfolio and invested $24 million of equity in the transaction.
The industrial properties are situated in strong urban logistics locations across the UK, including London and the South East, Yorkshire and the Midlands. The portfolio is 100% occupied with in-place rents at a significant discount to current market rates.
Since January 2022, the Kennedy Wilson team has acquired more than 41 industrial assets across the United Kingdom, Ireland, and Spain totaling $645 million, including $167 million of deals under contract, and continues to develop a pipeline of attractive future opportunities. This will bring the overall European industrial platform to 98 assets. Including deals under offer, total European industrial AUM is expected to grow by 61% year-to-date, from $1.1 billion to $1.7 billion, which will be secured by approximately $900 million of mortgage debt. Kennedy Wilson has an average ownership of approximately 20% in the European industrial platform and earns fees as manager.
“This acquisition provides access to a diversified portfolio of strategically located urban logistics assets,” said Mike Pegler, Head of UK for Kennedy Wilson. “The team has outperformed in its ability to grow the European industrial platform, and we remain confident about the future growth trajectory, which is underpinned by strong fundamentals. With sector take up in the first quarter of the year surpassing 10 million square feet for the first time since 2018, we expect robust ecommerce growth, a continued supply-demand imbalance and resultant rental growth to further enhance industrial capital values.”
Nico Fourie, CEO for Leftfield Advisors Ltd, comments: “Leftfield has met its objective of accumulating and optimizing this portfolio, the sale of which leaves it well positioned for considerable value-unlock over time. In addition to digital adoption, partial deglobalisation is driving onshoring, nearshoring and reshoring, making logistics assets ever more critical in the pursuit of greater supply-chain efficiencies. It’s business as usual for Leftfield as we continue to acquire assets into our next urban logistics and last-mile portfolio.”
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