Deals

Harbert buys £64m of assets from ProLogis

ProLogis European Properties, the listed European division of Denver-based ProLogis, has sold five distribution assets in the UK to the US alternative asset management firm, Harbert Management Corporation.

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Harbert Management Corporation has acquired five logistics properties in the UK for £64 million (€75 million; $105 million) from the Europe-listed arm of troubled Denver firm ProLogis.

Alabama-based Harbert said all of the assets were located in the south east of England and that affiliates of Harbert European Real Estate Fund II and Harbert European Real Estate Fund II Parallel had made the acquisition.

All of the properties were built by ProLogis European Properties between 2001 and 2007 and are fully occupied.

Scott O’Donnell, senior managing director for Harbert in Europe, said the firm had “renewed interest” in the UK and particularly the south east. “The underlying strength of the tenants, quality of the buildings and the locations and the significant cash flow generated are very attractive in light of the overall investment market,” he added.

ProLogis European Properties is a listed company in Europe managed by the Denver–based logistics giant which is in the middle of restructuring.

In May, the same company signed a sale and purchase contract with Curzon Capital Partners II, the core plus fund of AEW Europe, on a portfolio of seven distribution warehouses in the Netherlands and Germany, for €119.5 million. That sale price reflected a discount of 6.4 percent to a December 2008 valuation.

Today, parent group ProLogis said it had sold about $840 million of industrial assets as well as contributions to property funds in the second quarter of the year to help alleviate debt repayment issues.  

ProLogis had identified a portfolio of US industrial assets that it began marketing for sale in late 2008 as part of its deleveraging and de-risking program. It said some $561 million of assets have been sold this quarter while there is an additional $96 million of properties due to be sold. The Teachers Retirement System of Texas has reportedly been a major purchaser of some of these assets. It invested $426 million in return for a 95 percent stake in a portfolio of properties covering 9.6 million square feet of lettable space, according to reports. 

Earlier this year, ProLogis also sold a property in Japan to GIC Real Estate for $128 million as part of the company's sale of various Asian operations.