Boreal IM and Cadillac Fairview JV acquires 15 Dutch warehouses

• Boreal IM & Cadillac Fairview JV acquires 15 warehouses across four regions in the Netherlands
• Assets acquired from Europa Capital and the majority are last-mile distribution centres
• Follows JV’s €250m debut deals for logistics assets in London and Rotterdam announced in May

The Boreal IM & Cadillac Fairview JV (the “JV”) has closed its third deal, acquiring a logistics portfolio in the Netherlands for an undisclosed sum. Purchased from Europa Capital, the 142,000 sqm (1.5m sqft) portfolio comprises 15 warehouses across four regions, with the majority being last-mile distribution centres.

The JV, which aims to assemble a €3bn pan-European logistics portfolio, made its first two acquisitions earlier this year – the Nucleus Estate in Park Royal, West London, and six warehouses within the Port of Rotterdam, for a combined total of €250m.

Boreal IM partnered with Cadillac Fairview, the real estate arm of $242bn (AUM) Ontario Teachers’ Pension Plan, in early 2022. Boreal IM is led by Louis-Simon Ferland, who oversaw the formation and exit of €12.5bn Logicor, Blackstone’s pan-European logistics platform.

The majority of the properties were built within the last 15 years, with two newly constructed last-mile assets in Amsterdam completed earlier this year. The assets are located in densely populated and supply constrained markets with a majority located in the Randstad, an 8.4m people metropolitan area with a GDP per capita 60% above the Euro Area average. The portfolio, which is 95% leased to a diverse mix of tenants, has a WALB of 5.0 years and produces €8m of annual income.

All the assets are BREEAM certified, and the JV seeks to further enhance them with carbon reducing and tracking technology including LED lighting, solar PVs and renewed HVAC systems. The JV’s ESG strategy aims to harness technology to measure and benchmark the carbon footprint of each property and upgrade its design and energy system. It will also establish strong tenant engagement programs and implement green leases where possible.

The transaction brings the JV’s total holdings in the Netherlands, one of the core European geographies targeted by Boreal IM and Cadillac Fairview, to 240,000 sqm (2.6m sqft). The UK, Germany, France, Spain and Italy are amongst the other major European locations identified by the JV, which can invest across the entire risk-return spectrum, including standing assets and ground up developments.

James Farmer, Partner at Boreal IM, said: “This acquisition is a highly strategic one and creates a firm foothold within the Netherlands, one of our key target markets in the build-out of our pan-European portfolio. We were particularly attracted by the low in-place rents, which combined with the leases’ indexation provisions, will offer an attractive combination of defensive cash flows with material medium term upside. It dovetails well with our existing holding in the Netherlands, a 100,000 sqm estate in the Port of Rotterdam. Despite the current macro headwinds, we will continue to selectively make further investments for our portfolio on behalf of the JV with Cadillac Fairview.

We are able to execute this off-market deal by leveraging our extensive network of contacts and deep level sector expertise, and we continue to evaluate the market in search of attractive investment opportunities.”

Jenny Hammarlund, Head of Europe and Managing Director at Cadillac Fairview, said: “Today’s announcement, which sees us acquire a unique group of assets in a strategic market, once again demonstrates the strength of our partnership and joint commitment to growing our logistics portfolio with best-in-class assets and sound ESG practices.”