TH Real Estate targets €200m for German logistics fund

The London-based investment manager owned by TIAA is aiming to grow its German logistics portfolio beyond the 10 million sq ft mark. 

TH Real Estate, the property investment firm owned by TIAA, has launched its fourth logistics fund which will target German assets.

The firm is aiming to raise around €200 million of capital from institutional investors which, when leveraged, will give TH Real Estate total investment capacity of €300 million. The firm has already attracted commitments from five parties.

Capital from the vehicle, German Logistics Fund (GLOF) II, will be used to invest in core logistics assets across Germany and the firm has already struck its first deal for the fund, a 420,000 square foot logistics space near Hamburg.

TH Real Estate said the wider aim of the fund is to grow its German logistics portfolio from its current size of 7.6 million square feet to over 10 million square feet.

GLOF II is the fourth institutional logistics fund for German clients that TH Real Estate set up since 2011.

GLOF II’s predecessor, launched in 2012, raised around €260 million from institutional investors. To date, the capital has been invested across 16 assets and the firm is targeting an IRR of 8.5 percent over the life of the fund.

“The launch of the fourth logistics property fund within six years underscores the burgeoning growth of our logistics platform”, said Thorsten Kiel, head of logistics, Europe at TH Real Estate. “Against the background of the ongoing e-commerce boom and the progressing division of labor in nearly all production processes, demand for logistics properties will maintain its high current level for the time being,” he added.

In one of its most recent deals, in February TH Real Estate sold One Kingdom Street, a prime office property in west London, for £292 million ($366 million; €344 million) to an unnamed Hong King real estate investor. The 264,000 square foot building was sold on behalf of the firm’s €2.2 billion Cityhold Office Partnership (CHOP) fund, which targets assets in major European cities.