Barcelona urban logistics acquisition

In July 2021, the Company was pleased to announce the acquisition of a modern urban logistics warehouse in Barcelona, Spain’s second most populous city. The purchase price of €18.8 million reflected a net initial yield of 3.7% and net reversionary yield of 4.7%.

This 13,907 square metre asset is located in the first ring of Barcelona, within a 25 minute drive (27km) of the city centre and is well positioned to benefit from the growth of e-commerce and the scarcity of development opportunities, which provides strong rental growth potential. The local market is characterised by a low vacancy rate of 3%, which falls to 1% for the first ring, reflecting naturally occurring land constraints, with the city surrounded by the sea and mountains.

The asset is located on the Polinyà Logistic Park, a strategically positioned and highly consolidated industrial area just off the AP-7 motorway that connects Barcelona with France and the wider European market in the north, and to the south to Zaragoza, Madrid and other key cities along the Mediterranean coast of Spain.

This freehold asset, which was built in 2019 and meets modern specifications, is fully let to Mediapost, a subsidiary of LA POSTE Group, the French state-owned company, serving as its Spanish headquarters. The property offers a high-grade specification of c.11.5 metres clear height in the warehouse area, high quality office accommodation, 10 loading docks, LED lighting and a small solar PV installation which the Company will seek to enhance, making this a very sustainable investment. Accelerating e-commerce penetration and favourable demand supply dynamics offers rental growth potential.

Barcelona, Spain’s second largest city by population, is a key business hub within Europe and lies at the heart of a highly industrialised and populated area along the Mediterranean Corridor. Given its geographical location, it acts as an essential distribution hub connecting Spain with the rest of Europe and the EU common market which reaches approximately 450 million consumers. Catalonia’s strategic location near the French border is enhanced further by key seaports along the Mediterranean Coast such as Barcelona and Tarragona. Land scarcity in such areas continues to be a problem, and it is difficult for developers to buy new sites on which to develop quality logistics warehouses. With population density high and land constrained due to environmental barriers - the sea in the east and mountains to the west - we expect this well-located asset to deliver real shareholder value in the coming years.

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Risk warning
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