China’s e-shang sells lo­gis­tics as­sets to In­vesco for $300 mn

Mint Asia ST - - Inside - BPY RAMUGDHA M AMGAIN

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.

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