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Norwegian wealth fund, the Oil Fund acquires logistics property close to Nkr9 billion

Thursday, 20 December 2012
The Norwegian wealth fund, popularly known as the oil fund has bought half of a portfolio of logistics properties for about Nkr8.9 billion, reports the fund in a press release.

Prologis, which will retain a 50 percent stake in the venture, will manage the portfolio, which includes 195 properties in 11 European countries including France, Britain, Spain, Poland, and Italy.

The seller is the U.S. company ProLogis, which will continue to own the remaining 50 percent of the portfolio and responsible for the operations of the properties on behalf of the partnership.

"The agreement marks the fund's first investment in industrial real estate and is in line with our strategy to build a high-quality portfolio that's spread over different countries and sectors," said Karsten Kallevig, the fund's head of real-estate investment in a news release.
Nkr

The partnership initially is for a period of 15 years, which may be extended. The partners intend to repay existing bank debt in the first quarter of 2014. As part of the transaction, the Fund will receive options to purchase 6,000,000 shares of ProLogis for $ 35.64 per share.

Purchase price includes existing bank debt of 0.1 billion euros. The portfolio's exposure is found in places such as France, followed by the UK, Spain, Poland, and Italy. These countries account for 73 percent of the total investment value. The portfolio also has properties in the Czech Republic, Hungary, the Netherlands, Sweden, and Belgium.

The properties have 4.5 million square feet of floor space rental and used mainly as a distribution property of about 300 tenants from various industries.

ProLogis, Inc., is a leading owner, operator and developer of commercial real estate in the Americas, Europe and Asia.

At the end of September 2012, ProLogis owned or managed approximately 52.5 million square feet of real estate and development projects in 21 countries. The company rents distribution facilities to more than 4,500 customers

The transaction, which the parties agreed today, is expected to be completed in the first quarter of 2013.

The Fund has a goal that five percent of total assets will be invested in real estate. Before today's purchases and the third quarter was that share had reached 0.3 percent. It is determined that the expected 5 percent would be reached in 5 years time.
by Scancomark.com Team

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