Stoneweg acquires Cromwell’s European platform for €280m

CEREIT’s Tilburg logistics park.

Cromwell Property Group has agreed to sell its European fund management platform and interests, including the Cromwell Italy Urban Logistics Fund and Cromwell European REIT, to Geneva-headquartered Stoneweg for €280 million.

The transaction, still subject to regulatory approval, will bring Stoneweg additional AUM of €3.9 billion across a mix of core, core+ and value-add funds and mandates. Cromwell’s European platform comprises over 160 assets and 1,600 tenants, with 14 local offices in 12 European countries.

The acquisition includes: a 100% interest in Cromwell Europe Limited; a 27.8% unitholding in Singapore REIT CEREIT which has a €2.2 billion portfolio; 100% of the Singapore-based manager of CEREIT; and 50% of the Cromwell Urban Italy Logistics Fund

The deal is part of a strategy to simplify Cromwell’s business and move to a capital-light fund management model by selling non-core assets and realigning to Cromwell’s core competencies in Australia and New Zealand.

The deal, together with the sale earlier this month of the Polish retail portfolio, reduces Cromwell’s gearing to approximately 25% and is the final part of a A$1.6 billion sale programme.

Cromwell will continue to manage $4.8 billion of assets in Australia and New Zealand and the company said it will focus future efforts on growing its Australian and New Zealand funds management platform.

“I strongly believe that Stoneweg is an excellent match with very little overlap in terms of geographic and asset class focus,” Cromwell CEO, Jonathan Callaghan said. “We are confident they will be the right custodian for the capital that our platform manages and are well placed, enabling it to support these mandates and funds including the continued growth of CEREIT.”

The combined platform will operate as Stoneweg and will comprise about  €8 billion of assets in the residential, light industrial, logistics, hospitality, office, and cultural and leisure sectors across 15 European countries.

Stoneweg’s co-founders, CEO Jaume Sabater and head of acquisitions Joaquin Castellvi as well as strategic shareholder Max-Hervé George, will lead the enlarged platform.

Jaume Sabater.

Stoneweg currently has about €4 billion of assets under management and employs over 140 professionals across seven offices in Europe and the United States.

“This milestone transaction immediately creates a pan-European real estate asset management platform of scale and continues our strong track record of successful transactions to deliver value for our investors,” Sabater said. “It successfully brings together two highly complementary businesses with a shared conviction in the compelling structural, demographic and technological drivers underpinning select real estate asset classes in Europe.”

He added that the company looked forward to integrating the Cromwell European team.

Jonathan Callaghan.

“The addition of the manager of the Singapore-listed Cromwell European REIT extends our reach into Asia,” he added.

Jonathan Callaghan, CEO of Cromwell Property Group, commented: “I strongly believe that Stoneweg is an excellent match with very little overlap in terms of geographic and asset class focus, and I take this opportunity to thank all staff who have participated in this exercise, especially those joining Stoneweg as part of this transaction.”