Bridge Industrial, PSP Investments to Deploy $1.4B on UK Industrial Assets
Bridge Industrial and the Canadian pension fund, Public Sector Pension Investment Board (PSP Investments), have partnered to deploy around $1.4 billion into the acquisition and development of last-mile warehousing and distribution facilities in, and around, London and the Midlands region of the United Kingdom, according to information released on Thursday.
The duo will look for urban infill investment and development opportunities to build out its portfolio, targeting that $1.4 billion number as the potential size of the collection they hope to assemble.
According to the duo’s announcement, they will focus on “build-to-core” opportunities, which will revolve around last-mile facilities in “high barrier infill submarkets” around London and the Midlands region, which includes Birmingham and its surrounding towns — England’s second-largest metropolitan area.
Bridge Industrial, an investment and development firm founded in 2000, that has executed on more than $7.8 billion worth of industrial real estate in its time, will oversee all development activities and “value-add measures” for purpose-built properties.
Bridge Industrial CFO Sean Zasche expressed the firm’s excitement in forming the joint venture with PSP Investments, adding that his firm “continues to grow its global portfolio and capital partnerships … [PSP’s] focus on high-quality, infill real estate and long-term ownership aligns well with Bridge’s business model.” The firm’s operations in the U.K. are led by Partner Paul Hanley, who heads up a group of investment and development pros based out of its London office.
“We’re extremely excited about the growth in the logistics industry that is creating strong demand for facilities across the United Kingdom,” Hanley said. “This joint venture with PSP Investments marks the beginning of a long-term partnership that will allow us to continue the strategic expansion of our portfolio.”
PSP Investments is one of Canada’s largest investment managers, sporting a whopping $169.8 billion in net assets under management, with about $24 billion of that concentrated in real estate — about 19 percent of the real estate book is in the industrial sector — according to its 2020 annual report. Last year, the pension fund investor, which has a sizable portfolio of industrial assets, actually made some big splashes within the film studio front, investing, as part of a massive consortium, in Amazon Studios’ Culver City campus and Manhattan Beach Studios; it also picked up a minority interest in CBS Television City studio complex in Los Angeles. On the industrial front last year, it engaged in a number of large transactions globally, including in Europe and Mexico.
“We are pleased to be partnering with Bridge to invest in the U.K. logistics sector as we grow our already extensive European logistics portfolio,” said Stéphane Jalbert, a managing director at PSP, who covers real estate investments in Europe and Asia Pacific. “Urban logistics is a key sector for PSP globally, given the accelerated growth of e-commerce and the need to adapt real estate to meet shifting consumer behavior. Bridge has proven development capabilities from which the venture will benefit, enhancing returns beyond the sector trend.”