Prologis, the San Francisco-based industrial real estate developer and fund manager, is to merge a €571 million joint venture it manages with Allianz, with its Europe-focused open-ended core fund, Prologis Targeted Europe Logistics Fund (PTELF).
According to Prologis, under the terms of the transaction, PTELF will acquire the venture, called Logistics Venture, or ELV 1, before integrating the assets into the fund.
As part of the transaction, ELV1 has also acquired an additional asset from Prologis, while Allianz has purchased Prologis' 15 percent stake in ELV1. Moreover, Prologis will also receive net cash proceeds of approximately €183 million.
With the addition of Allianz, the fund will have approximately 40 investors, including Prologis itself.
“Combining PTELF and ELV1 benefits all parties involved. Allianz meets its investment objective by deploying more capital in European logistics real estate, existing investors in PTELF benefit from improved scale, a stronger balance sheet and greater liquidity, and Prologis further streamlines its strategic capital business,” said Gary Anderson, chief executive officer for Prologis Europe and Asia.
“By contributing ELV1, its prior and successful joint venture with Prologis into PTELF, Allianz will gain exposure into a larger, more liquid portfolio with greater diversity, at a time when the industry is also consolidating. As the logistics sector is a particular area of focus in our portfolio construct, Allianz is looking forward to the strengthening of its relationship with Prologis by becoming the largest investor in PTELF and supporting the future growth of the fund,” said François Trausch (pictured), CEO of Allianz Real Estate.
Prologis currently owns and operates approximately 178 million square feet in 731 buildings across the European market.