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International investors make headway with French logistics

Hines scheme at Blanquefort, Gironde.

Logistics investors, including Hines, BentallGreenOak and Clarion Partners Europe, are targeting France in response to intensified demand from the e-commerce sector and third party logistics firms.

Hines has acquired 11 logistics assets in France from retail group Auchan. The portfolio, which has total space of 350,000 sq m, was bought on behalf of Hines European Value Fund 2 (HEVF 2) in a sale and leaseback deal.

The assets are located in Paris, Bordeaux, Clermont-Ferrand, Lyon, Nîmes, Strasbourg, Tours with two each in the Amiens and Lille regions.

The HEVF series invests across the major real estate sectorsbut while HEVF 1 focused on core-plus and value add office investments, HEVF 2 is most active in the logistics and living space.

“Many cross-border investors have struggled, in relative terms, to gain exposure to the logistics sector in France, so achieving this scale and quality in one transaction is a great success for HEVF 2,” said Hines senior managing director and HEVF 2 fund manager Paul White.

French market to benefit from changing consumer behaviour

He added that the French logistics market is expected to benefit from strong fundamentals with rising demand, partly driven by accelerated trends in changing consumer behaviour, combined with constrained supply in the context of demanding planning and permitting rules.

Hines was advised by Lacourte Raquin Tatar, Lasaygues, PwC, Etyo and BNP Paribas Real Estate.

Meanwhile, investment manager BentallGreenOak has acquired a site in the Angers region where it will build a 25,000 sq m logistics facility. The firm said that the deal bolsters its position in the French logistics market, where it has invested €700 million in logistics assets since 2017.

Elsewhere, logistics and industrial property fund manager Clarion Partners Europe has signed a lease with tenant ID Logistics, for its recently completed 70,000 sq m warehouse in Brebières, northern France in what the firm said is one of the largest lettings in the French logistics market in 2021.

Market is ‘critically undersupplied’ says Clarion

Clarion is progressing with a 180,000 sq m warehouse development pipeline in France, which it describes as “a critically undersupplied market”.

Clarion’s Brebières project.

The Brebières property, was acquired on behalf of a commingled fund client, via a forward funding agreement in December 2019. The building was delivered in March 2021.

Clarion is also on track to complete a 69,000 sq m warehouse asset in Reau, 40 km southeast of Paris city centre, by the end of this year and is funding the development of a pre-let 74,245 sq m logistics warehouse in Boisseaux, south of Paris. It will begin construction of a 37,000 sq m warehouse at Marolles sur Seine, in north-central France, later this year.

 “Since the start of 2018, we have invested over €400 million in the French logistics market, reflecting our conviction in a market experiencing one of Europe’s fastest-growing rates of e-commerce penetration,” said senior asset manager Tangi Le Balc’h.