Acquisition of Second Asset Following IPO
Aberdeen Standard European Logistics Income PLC (LSE: ASLI) (the "Company")
LEI: 213800I9IYIKKNRT3G50
8 June 2018
ACQUISITION OF SECOND ASSET FOLLOWING IPO
'ZUM FLIEGERHORST 1304' LOGISTICS DEVELOPMENT, ERLENSEE FOR €33 MILLION
The Company is pleased to announce that it has exchanged contracts to acquire a new development in a modern logistics hub located in Erlensee Langendiebach, Frankfurt for an expected net value of €33.3 million (subject to final rental conditions and full occupancy) from regional developer Ferdinand Fäth.
The acquisition will be funded from existing cash, following the successful launch of the Company in December 2017, with completion expected in September 2018.
This freehold property development is expected to be completed in September and will consist of two modern multi-let logistic buildings. It is located within the emerging logistics and distribution hub of Erlensee, on the outskirts of Frankfurt in the prosperous Rhine/Main region, the third largest metropolitan region in Germany with 5.8 million inhabitants. The redevelopment of this former US air base is proceeding at pace. The location's quality has already been recognised by a number of major companies including DS Smith, Dachser Logistics and Wilhelm Brandenburg, the largest meat processing company in the region, with plans for a major facility servicing REWE the German supermarket group. It is expected to become one of the major logistics hubs in the region benefitting from an excellent road infrastructure serviced by the A45 and A66 motorways in the north east of Frankfurt and in the south by the A3 motorway, as well as having direct access to the Frankfurt metropolitan area.
This development fits well with the Company's investment strategy given the modern and flexible specifications of the buildings and the central location. The buildings comprise a total lettable area of approximately 26,395 square metres featuring high quality construction and institutional grade specifications including a total of 50 loading doors. Net initial yield is expected to be in the region of 5.4% reflecting forecast passing rent and full occupancy.
An earn-out agreement means that the Company will pay the purchase price, based on the effective letting of the building, after completion of the construction works with a minimum occupancy rate to be delivered by the developer which has already signed lease agreements with two high quality tenants. Full take-up is expected for this prime asset by or around the time of completion.
Evert Castelein, the Company's Fund Manager, commented:
"We are extremely pleased with this premium development opportunity which we expect to close in September 2018. With the support of our local Frankfurt based asset management team we are confident that we can generate a solid and sustainable income stream from an asset located in an area in which we see strong demand for modern, best in class logistics facilities.
Our pipeline of investment opportunities remains strong across Europe. A number of further properties are undergoing due diligence or have price agreements in place and announcements will be made at the appropriate time. We remain confident that the deployment of capital is proceeding as planned as we continue to build a well-diversified portfolio of high quality European logistics properties aiming to be fully invested within twelve months of launch."
For further information:
Aberdeen Fund Managers Limited
0207 463 6000
William Hemmings
Gary Jones
Jonathon McManus
Canaccord Genuity Limited
0207 523 8000
Will Barnett
Neil Brierley
Dominic Waters
David Yovichic
Notes to Editors
Aberdeen Standard European Logistics Income PLC is a UK investment trust with a premium listing on the Main Market of the London Stock Exchange. The Company invests in European logistics real estate to achieve its objective of providing its shareholders with a regular and attractive level of income return together with the potential for long term income and capital growth. The Company aims to invest in a portfolio of assets diversified by both geography and tenant throughout Europe, predominantly targeting well-located assets at established distribution hubs and within population centres.
The Company launched on 15 December 2017 raising gross proceeds of £187.5m. Portfolio management services are undertaken by Aberdeen Asset Managers Limited.
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