Key Takeaways
- • CBRE Investment Management, the investment management affiliate of CBRE Group (NYSE: CBRE), is acquiring a $4.9 billion logistics real estate portfolio from Hillwood Investment Properties, the real estate business founded by Ross Perot Jr., according to FreightWaves.
- • The portfolio comprises more than 57 properties and over 28 million square feet of warehouse space, with about 19 million square feet in the U.S. and the remainder in Germany, Poland and the U.K.
- • The portfolio includes a mix of existing assets and development projects, and CBRE expects to close the transaction in stages.
- • CBRE Investment's total assets under management exceed $130 billion, and logistics and industrial properties made up more than a quarter of that total within three months of the firm establishing a global logistics unit in June 2021.
- • The deal follows Blackstone's $2.8 billion acquisition of 17.4 million square feet of warehouse space last month, reflecting sustained institutional demand for logistics assets tied to e-commerce fulfillment.
Summary
CBRE Investment Management, an independently operated affiliate of CBRE Group, the world's largest commercial real estate services company by the publisher's description, is buying a $4.9 billion portfolio of logistics properties from Hillwood Investment Properties, according to FreightWaves. The publication describes the transaction as one of the largest industrial real estate deals on record.
The portfolio comprises more than 57 properties and over 28 million square feet of warehouse space. Roughly 19 million square feet sit in the United States, with the balance located in Germany, Poland and the U.K. A CBRE Investment spokeswoman told FreightWaves that the portfolio "includes a combination of existing assets and development projects," and CBRE expects to close on the assets in stages.
Chuck Leitner, CEO of CBRE Investment, said in a press release that the transaction "reflects our ability to leverage the strong financial capacity of our parent company to secure compelling opportunities." Leitner told The Wall Street Journal that the deal makes real estate close to consumers more economically attractive, and told The Washington Post that the firm favors the Hillwood portfolio because its properties are near large labor pools, advanced transportation systems and concentrations of consumers. Those features are valued by retailers seeking to expand fulfillment capacity and e-commerce sales.
The acquisition reflects strong demand for warehouse space. Real estate services firm JLL estimates the U.S. will add more than one billion square feet of warehouse space by 2025. CBRE Investment established a global logistics unit in June 2021, and within three months logistics and industrial properties accounted for more than a quarter of its more than $130 billion in assets under management. Leitner described the firm's global logistics platform as backed by $35 billion in assets under management.
The deal comes amid other large transactions. Blackstone recently acquired a $2.8 billion portfolio of 17.4 million square feet of warehouse space. For comparison, Prologis, the industry leader, holds about $72 billion in logistics real estate assets totaling 684 million square feet across more than 3,000 facilities. Separately, New York-based BEB Capital announced a joint venture with Rockpoint Group targeting $1 billion of industrial properties in the Northeast U.S.
The portfolio comprises more than 57 properties and over 28 million square feet of warehouse space. Roughly 19 million square feet sit in the United States, with the balance located in Germany, Poland and the U.K. A CBRE Investment spokeswoman told FreightWaves that the portfolio "includes a combination of existing assets and development projects," and CBRE expects to close on the assets in stages.
Chuck Leitner, CEO of CBRE Investment, said in a press release that the transaction "reflects our ability to leverage the strong financial capacity of our parent company to secure compelling opportunities." Leitner told The Wall Street Journal that the deal makes real estate close to consumers more economically attractive, and told The Washington Post that the firm favors the Hillwood portfolio because its properties are near large labor pools, advanced transportation systems and concentrations of consumers. Those features are valued by retailers seeking to expand fulfillment capacity and e-commerce sales.
The acquisition reflects strong demand for warehouse space. Real estate services firm JLL estimates the U.S. will add more than one billion square feet of warehouse space by 2025. CBRE Investment established a global logistics unit in June 2021, and within three months logistics and industrial properties accounted for more than a quarter of its more than $130 billion in assets under management. Leitner described the firm's global logistics platform as backed by $35 billion in assets under management.
The deal comes amid other large transactions. Blackstone recently acquired a $2.8 billion portfolio of 17.4 million square feet of warehouse space. For comparison, Prologis, the industry leader, holds about $72 billion in logistics real estate assets totaling 684 million square feet across more than 3,000 facilities. Separately, New York-based BEB Capital announced a joint venture with Rockpoint Group targeting $1 billion of industrial properties in the Northeast U.S.
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