Target Information

H.I.G. Capital, a prominent global alternative investment firm, has recently acquired a strategically located logistics portfolio in France’s two largest metropolitan areas, Paris and Lyon. This acquisition includes two fully leased logistics assets that provide direct access to major highways and airports. The portfolio consists of six properties totaling approximately 50,000 square meters of logistics space, presenting considerable opportunities for capital improvements and enhancing market positioning to meet grade-A standards.

Industry Overview

France's logistics industry is undergoing significant changes, driven by the increasing demand for efficient supply chain solutions in urban areas. The growth of e-commerce and the rising necessity for fast delivery services have heightened the demand for last-mile logistics. This demand is particularly pronounced in densely populated regions like Paris and Lyon, where real estate is scarce and logistics properties are essential for meeting consumer expectations.

The logistics sector in France is characterized by its resilience amid economic fluctuations. As urbanization accelerates, businesses are recognizing the strategic importance of proximity to urban centers, leading to increased investments in logistics infrastructures. Additionally, the government’s focus on improving transportation links has further bolstered the attractiveness of the logistics market.

Paris and Lyon, as key commercial hubs, are witnessing robust growth in logistics operations. The combination of their geographical advantages and the concentration of businesses generates substantial demand for logistics services. This trend underlines the sustainability of the logistics sector in the face of market challenges, showcasing its relevance for investors looking to capitalize on urban expansion and e-commerce growth.

Rationale Behind the Deal

The acquisition of logistics assets in Paris and Lyon aligns with H.I.G. Realty’s strategic focus on investing in well-located properties that enhance their urban logistics platform. By securing these key assets, H.I.G. is positioning itself to capitalize on the impressive demand for last-mile logistics solutions in supply-constrained markets. This proactive approach is expected to yield long-term value, driven by anticipated market growth and evolving consumer preferences.

Moreover, the strategic locations of these assets provide H.I.G. with a competitive advantage, allowing for improved distribution capabilities and enhanced service delivery to businesses within the metropolitan areas. This acquisition is not only a reflection of H.I.G.'s confidence in the logistics sector but also an indicator of the firm’s commitment to expanding its portfolio in high-demand regions.

Investor Information

H.I.G. Capital manages $68 billion of capital and is recognized as a leading firm in the alternative investment landscape. With a strong track record of making strategic investments across various sectors, H.I.G. focuses on identifying opportunities that offer significant upside potential. The firm’s dedicated team, including Managing Directors Riccardo Dallolio and Jérôme Fouillé, are instrumental in navigating the logistics market and capitalizing on the sector’s growth prospects.

As part of its investment strategy, H.I.G. Realty emphasizes the importance of acquiring high-quality assets in key locations. Their experience and understanding of real estate markets enable the firm to leverage favorable conditions and enhance property values over time. They continue to seek further opportunities to expand their logistics presence, particularly in France’s largest cities.

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This acquisition by H.I.G. Capital appears to be a sound investment, primarily due to the strategic positioning of the logistics assets in Paris and Lyon. The robust demand for last-mile logistics services in these urban markets significantly enhances the potential for long-term growth and profitability. Furthermore, the strong fundamentals underpinning the logistics sector in France provide a solid foundation for H.I.G.'s investment strategy.

The resilience of the logistics industry, especially amidst rising e-commerce trends, suggests that H.I.G.'s investment is well-timed. As more consumers turn to online shopping, the need for efficient distribution networks will continue to grow, making logistics properties increasingly valuable. This reinforcing trend positions H.I.G. to benefit from sustained demand.

Additionally, the potential for capital improvements within the portfolio adds another layer of value to the investment. By implementing strategies to enhance the properties to meet grade-A standards, H.I.G. can elevate asset performance and increase returns. As the urban logistics market evolves, this capability will be paramount to maintaining a competitive edge.

Overall, the acquisition reflects H.I.G. Capital’s strategic foresight and commitment to investing in high-demand markets. The logistics portfolio not only strengthens its presence in France but also positions the firm favorably to capture future opportunities in an increasingly important sector.

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