22nd May 2015 06:28
LONDON (Alliance News) - SEGRO PLC Friday said it has exchanged contracts to buy 90% of Vailog Srl for EUR39.6 million, or about GBP28.1 million, a move that gives it an immediate platform in the big box warehouse sector in northern Italy and new assets elsewhere including Paris.
Vailog is an Italian logistics real estate development company that was founded in 2003. According to SEGRO, it has since developed over 1.5 million square metres of logistics space in Italy, France and the Netherlands, working with investors including Deka Immobilien, AEW and Hines. It also owns logistics properties in Italy and France, together with a land bank and options over land principally in the major European logistics hubs of Milan, Bologna, Rome, Paris, Lyon and Arnhem in the Netherlands.
"Northern Italy is one of the major Continental European logistics markets, benefiting from a strong manufacturing heritage and an affluent population. SEGRO has been active in the region for some time but the acquisition of Vailog provides an immediate logistics platform there. Together with the benefits of adding critical mass to our existing big box logistics presence in Paris, this acquisition provides significant future development opportunities," SEGRO Chief Executive David Sleath said in a statement.
Vailog's portfolio contains recently completed assets totalling 45,400 square metres of logistics space in Bologna, Milan and Paris valued on a 7.1% topped-up EPRA net initial yield and a net equivalent yield of 6.8%, SEGRO said. It also has a 94,300 square metre distribution warehouse under construction in Italy which is pre-let to Leroy Merlin on a 13 year lease and has a gross development value of EUR24.3 million.
The Italian company also has a EUR25.3 million 100 hectare land bank, mainly around Milan and other logistics centres in Northern Italy, capable of supporting 338,000 square metres of development within the next five years at an estimated yield on cost of approximately 8%, SEGRO said. It also has options over a further 80 hectare land bank that's valued at EUR1.8 million.
Vailog is also involved in generating income from photovoltaic cells installed on its previously developed big box warehouses in Italy, producing annual earnings before interest, tax, depreciation and amortisation of about EUR1.8 million.
By Steve McGrath; [email protected]; @stevemcgrath1
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