Dream Industrial REIT, through its wholly owned subsidiary, Dream Industrial Europe Advisors Cooperative UA (“Dream Industrial”), announced the acquisition of shares of a corporation that owns a portfolio of 31 institutional quality logistics properties (“Portfolio”) from Clarion Partners Europe (“Clarion”).
The portfolio, which has been amassed by Clarion over the past four years, totals over 827,000 square metres across six European markets. The value of the assets totals €882 million, representing a going-in capitalization rate in the low 4% range, including excess land. By value, approximately 90% of the 31 properties is located in Germany, the Netherlands, France and Spain, with one property in each of Slovakia and the Czech Republic. The portfolio includes significant excess land totaling 95,000 square metres, providing longer term intensification opportunities.
The portfolio is 100% leased with a weighted average term of 5.3 years, has an average construction date in the mid-2000s, and an average clear height of 10.5 metres. The properties are leased to a range of high-quality tenants with strong/investment grade credit ratings, including multi-national corporations. Food distribution and third-party logistics tenants represent 50% of the portfolio by net rent.
Dream has been active in Europe since 1998. Through Frankfurt and Toronto Stock Exchange listed Dream Global REIT, it assembled a €4.3 billion portfolio of high-quality office and logistics assets located primarily in Germany and Netherlands that was sold to a leading global private equity firm in 2019. Since its inception, Dream Global REIT delivered total annualized returns of 15% to unitholders, which exceeded both the Canadian and European benchmarks by approximately 60% over the same period. Dream’s long-standing relationships with the local real estate brokerage networks and market participants provided the opportunity for Dream Industrial REIT to seamlessly expand into Europe in January 2020. Since then, Dream Industrial has acquired over €1.2 billion of high-quality logistics properties across major European markets. Following the transaction, Dream Industrial’s gross asset value increases to over €3.3 billion and Europe will account for approximately 37% of total assets, up from approximately 14% as at March 31, 2021. This is consistent with its strategy of growing in markets that have significant barriers to entry and provide strong organic growth potential.
Source : Company