LaSalle Investment Management has formed a joint venture agreement Realty Vailog, an Italian industrial sector development company, to acquire and develop logistics facilities in the Greater Shanghai Region.
The acquisitions be made by LaSalle Asia Opportunity Fund III, a $1 billion (€750 million) vehicle targeting opportunities across Asia. The agreement has been seeded with a portfolio of four properties purchased from various sellers for approximately RMB 792 million ($112 million). Those properties consist of one build-to-suit development and three speculative developments all located within logistics corridors in the Shanghai region.
Once the deal is complete LaSalle will have a total of 320,000 square meters of logistics space in the Shanghai region.
The build-to-suit development in the portfolio is a 47 acre site located in the Songjiang District of Shanghai and is a direct land acquisition from the government. An undisclosed tenant has already leased the entirety of the project. The speculative developments are located in the Jiading, Minhanf and Lingang districts.
“LaSalle has a successful history of partnering with Vailog through our pan-European open ended fund Encore+,” Trent Iliffe, Regional Director for LaSalle Investment Management, said in a statement. “Vailog is a reputable and experienced international logistics developer.”
LaSalle has previously partnered with Vailog through its pan-European open-ended fund Encore+. “Over the past two years, Vailog has taken strategic land positions in the key logistics areas of Shanghai, building a team of experienced Chinese real estate professionals,” Realty Vailog chairman Giuseppe Garofano said in a statement. “The partnership will allow Vailog to expand the offer of new logistics spaces in China on a much larger scale and join forces with LaSalle to serve the needs of our respective customers.”
The China logistics market has been receiving an increasing amount of attention. In 2006, the logistics sector in China experienced 17 percent year-over-year growth, reaching approximately $8.3 trillion, an increase of nearly 600 percent since 1995. Increasing retail activities have driven this growth, as well as increasing manufacturing outputs and a rise in both imports and exports.