Stockbridge announced today that it has formed a joint venture with the National Pension Service of Korea ("NPS") to acquire core logistics properties in the U.S. In partnership with Stockbridge’s open-end core fund and an additional institutional investor, this newly formed venture has committed to acquire a 14.3-million square foot portfolio of Class A logistics facilities across the U.S.—the largest transaction by value of industrial properties since the onset of the pandemic. Financial terms of the transaction and the seller were not disclosed.
The portfolio includes recently completed and soon-to-be-completed properties, with a significant representation of major e-commerce tenants under long-term leases. With an average year built of 2020, the portfolio embodies the latest evolution in technology-forward logistics construction, designed towards meeting demand for ever-faster e-commerce fulfillment and delivery times.
"We are excited to acquire high-quality industrial properties that are well aligned with our strategy to capitalize on the paradigm shift to e-commerce," said Scott Kim, Head of the Real Estate Investment Division at NPS. "This acquisition will be an excellent addition to our real estate portfolio. Additionally, our local presence in New York has allowed us to quickly underwrite the portfolio and manage partner relationships to successfully form this venture."
"We see this acquisition as an exceptional way of tapping into the rapid acceleration of e-commerce growth—one of the most impactful investment themes post-COVID, and likely of the decade to come," said Terry Fancher, Stockbridge Executive Managing Director. "The tremendous ongoing support of our venture partners has afforded us the opportunity to transact quickly and nimbly in order to access these kinds of rare opportunities at scale."
"This is an extraordinary-quality core portfolio considering its modern construction, high-credit and e-commerce tenant base, and long-term leases," added Nicole Stagnaro, Stockbridge Managing Director. "It’s difficult to find better cash-flow visibility across private equity real estate today, particularly in a period of broad market uncertainty."
The transaction is Stockbridge’s third large-scale portfolio acquisition in the industrial sector in the past 16 months. Other recent purchases include an 8.7-million-square-foot portfolio in November 2019 and a 6.4-million-square-foot portfolio in August 2019. The firm has also been highly active in single-asset industrial acquisitions throughout 2020. Combined with the most recent transaction, Stockbridge’s growing industrial footprint is on track to surpass 55 million square feet.
Along with this growth, Stockbridge earlier this year hired industrial expert David Egan as a Senior Vice President. Mr. Egan, formerly Global Head of Industrial and Logistics Research with CBRE, offers vast knowledge of the supply chain as Stockbridge expands across traditional and niche industrial segments.
The following parties contributed to the subject transaction:
Lenders: PGIM Real Estate Finance and Nuveen Real Estate
Debt Placement Advisor: Eastdil Secured
Counsel: Gibson Dunn & Crutcher LLP and Clifford Chance US LLP
Property Management: Jones Lang LaSalle
Valuation Advisors: CBRE, Colliers International, Cushman & Wakefield, Eastdil Secured and Jones Lang LaSalle
ABOUT NATIONAL PENSION SERVICE OF KOREA
The National Pension Service of Korea (NPS) is one of the largest pension funds in the world with approximately $672 billion USD in assets as of September 30, 2020. NPS manages its funds investing in financial investment assets both of domestic and global, while diversifying the investment portfolio into equities, fixed-income and alternative asset classes, including real estate, private equity and infrastructure.
Stockbridge is a real estate investment management firm led by seasoned professionals averaging 25+ years of real estate industry experience. The firm manages real estate equity investments across the risk spectrum within a variety of investment structures on behalf of U.S. and foreign institutional investors. Stockbridge has approximately $18.4 billion of assets under management (as of September 30, 2020) spanning all major real estate property types, and certain specialty property types, throughout the United States. The firm has offices in San Francisco, Atlanta and Chicago. https://stockbridge.com/
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