China’s e-shang sells logistics assets to Invesco for $300 mn
US real estate investment manager Invesco is acquiring a portfolio of core logistics assets in China from Warburg Pincus-backed e-shang Redwood (ESR) for about $300 million, marking its first investment in the country’s real estate sector.
“Esr...and Invesco Real Estate, a global real estate investment manager, are pleased to announce a joint venture partnership for the acquisition and ongoing asset management of a portfolio of core logistics assets in China...,” the firms said in a joint statement on 8 September.
The portfolio of Grade A stabilized logistics real estate assets in China, valued in excess of RMB2 billion (approximately $300 million), will see Invesco acquire a majority stake in the portfolio from ESR, the statement said.
ESR will retain an equity interest and act as the project and property manager of the assets to drive future value for Invesco in partnership with Invesco’s asset management team, it added.
For ESR, this represents its first joint venture vehicle on stabilized assets in China, unlocking meaningful value from its balance sheet and recycling capital for its robust future growth initiatives. For Invesco, this transaction marks its first investment into China’s logistics sector, further expand- ing the global investment manager’s core footprint in Asia.
Jeffrey Shen, CO-CEO and co-founder of ESR said, “Invesco’s global capabilities and reputation combined with ESR’S pan-asia logistics expertise create a much stronger platform for our logistics real estate efforts in the region. In addition to this China transaction, we see many other ways to cooperate across the region with the goal of creating long-term value for our sharehold- ers and investors.”
ESR is a pan-asia logistics real estate firm with approximately 9 million square metres of projects owned, managed and under development across China, Japan, Singapore, South Korea and India, with capital and funds management offices in Hong Kong and Singapore. It focuses on developing and managing logistics facilities that cater to third-party logistics providers, e-commerce companies, bricks-and- mortar retailers, cold-chain logistics providers and industrial companies.
Co-founded by senior management and private equity firm Warburg Pincus, ESR also counts APG Asset Management, Canada Pension Plan Investment Board (CPPIB), Goldman Sachs, Morgan Stanley and PGGM Investments among its investors. The firm has assets under management valued at over $8 billion.
On the partnership, Cheng Soon Lau, Invesco Real Estate’s managing director– Asia Pacific said: “We are very pleased to have the opportunity to partner with ESR and invest in a portfolio of high quality logistics facilities in China. Our team has already developed a strong working relationship with the ESR team and we look forward to growing our partnership with them.”
With over 6,800 employees worldwide, Invesco manages over $850 billion in assets around the globe, serving clients in more than 120 countries as of 30 June, 2017.
The transaction is expected to close by the end of October this year.
Equity interest: e-shang Redwood president Charles de Portes.