Target Information

Crossbay, a pan-European urban logistics platform established by the real estate investment manager MARK, has made a significant acquisition by purchasing a 43,000 sq.m last-mile logistics warehouse located in Montcada, on the outskirts of Barcelona. This transaction adds to Crossbay's prominent portfolio in Spain, bringing the total warehouse space to over 150,000 sq.m across 12 assets, with other properties located in major cities such as Madrid, Valencia, and Seville.

The acquisition signifies Crossbay's commitment to fortifying its operational presence in key European markets, particularly focusing on urban logistics. The recently acquired logistics hub will serve as a critical distribution center for Condis Group, a leading food retailer with 600 stores across Barcelona.

Industry Overview in Spain

The logistics industry in Spain has witnessed rapid transformation, especially propelled by the surge in e-commerce activity following the pandemic. With an approximate 35% increase in e-commerce sales during 2020, there's an evident shift in consumer shopping behaviors which has fueled the demand for logistics and warehousing space in the country. This growth trend has encouraged increased investment and consequently, rising prime rents in logistics real estate.

Spain's logistics market is characterized by its strategic geographical location, acting as a gateway between Europe, North Africa, and the Americas. This advantageous position, combined with well-developed infrastructure, enhances its appeal as a core logistics hub within Europe. Additionally, the country's improving logistics capabilities are aligning with the growing needs of businesses aiming to optimize their supply chains.

The pandemic has not only accelerated the shift towards online shopping but has also sparked interest in logistics modernization. Companies are now focusing on upgrading their distribution facilities to remain competitive and meet the evolving expectations of consumers and investors alike, thereby creating a vibrant environment for logistics investments.

Forecasts suggest that Spain will continue to experience strong growth in the logistics sector, driven by sustained e-commerce momentum and ongoing digitalization within retail. As urbanization trends continue, demand for efficient last-mile delivery solutions is expected to rise dramatically, offering lucrative investment prospects for logistics operators and investors.

Rationale Behind the Deal

The acquisition is a pivotal element of Crossbay's broader strategy to capitalize on the European e-commerce boom and its associated logistics demands. By securing a prominent last-mile logistics facility in close proximity to a major urban center like Barcelona, Crossbay is well-positioned to support the growing logistics needs of retailers such as Condis Group.

This deal aligns with Crossbay's objective to expand its assets under management (AUM) in Spain, targeting €500m in the coming three years, further solidifying its status as a key player in urban logistics across Europe.

Investor Information

Crossbay, launched by investment manager MARK in May 2020, has rapidly emerged as a leader in urban logistics with a robust portfolio encompassing nearly 120 assets across various European nations. With a specific focus on single-user distribution centers, Crossbay has cemented its presence in markets including Italy, France, Spain, Belgium, Germany, and the Netherlands.

The firm secured significant backing from notable investors in late 2020, gathering €550m in equity commitments from prominent institutions such as Townsend Group, CBRE GI, and Credit Suisse. This financial strength has empowered Crossbay to pursue strategic acquisitions across Europe, further enhancing its logistics portfolio.

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The current acquisition by Crossbay is a strategic move that promises sound investment returns, given the increasing demand for logistics space fueled by the e-commerce sector in Spain. Crossbay’s targeted approach in identifying high-value urban logistics assets bodes well for its future growth and operational success.

The decision to invest in a last-mile facility reflects an astute understanding of the evolving retail landscape, where rapid delivery logistics are pivotal. Moreover, the long-term lease commitment from Condis ensures predictable cash flows, enhancing the investment’s stability.

Considering Spain's expanding logistics market driven by increased online shopping and infrastructure improvements, Crossbay's initial investment appears timely and potentially lucrative. Investors can expect that the ongoing modernization of logistics facilities will further unlock additional value in this regard.

Overall, the attractiveness of the deal, alongside Crossbay's established track record and strategic vision, indicates that this acquisition could bolster their portfolio significantly, making it a potentially wise investment in the flourishing logistics sector.

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