6 Feb 2025 | 08:15 | London | by Chris Borland
Partners’ new Space Industrial platform focuses on multi-let assets.
Invesco Real Estate and Marchmont Investment Management have formed a joint venture to build a £500m multi-let industrial portfolio in the UK, Green Street News can reveal.
The new platform, which will acquire, manage and reposition multi-let assets, is called Space Industrial. The portfolio has been seeded with four assets in Milton Keynes, Sheffield, Manchester and Pershore.
Equity for the joint venture from Invesco has been provided from the Invesco Real Estate Europe Fund III – SCSp (Europe III), the third closed-end fund in a series dedicated to pan-European higher returning investments.
“Despite the recent market volatility, this sector has remained liquid, with both investors and lenders continuing to show strong appetite” RICHARD CHAMBERS, INVESCO REAL ESTATE
Space Industrial will invest from its own balance sheet capital and on behalf of other third-party capital, with the intention of supporting the equity with a similar quantum of debt to create a £500m portfolio.
Richard Chambers, managing director – fund management, Invesco Real Estate, said: “The UK industrial sector continues to offer very attractive investment opportunities on a select basis. Despite the recent market volatility, this sector has remained liquid, with both investors and lenders continuing to show strong appetite. This new venture with Marchmont IM is well positioned to capitalise,”
Investment strategy
Space Industrial plans to target under-rented multi-let industrial estates in last-mile locations close to key urban centres. The platform will look to drive income returns through “proactive asset management and focus on brown-to-green ESG initiatives to meet the highest possible sustainability criteria”.
UK-based Marchmont IM, a specialist operator in the industrial and logistics space, has an extensive track record in successfully aggregating portfolios and has completed over 100 transactions at a value of £1.5bn.
We consider the combined track record of our businesses presents a compelling partnership to execute in this space” TIM LUMSDON, MARCHMONT
Tim Lumsdon, CEO of Marchmont IM, said: “As an established operating partner in the UK MLI market, the opportunity to work with Invesco to develop and grow a dedicated vertically integrated platform in this sector is an exciting proposition. We consider the combined track record of our businesses presents a compelling partnership to execute in this space.”
Cameron Fraser, CIO of Marchmont IM, added: “The UK MLI market has repriced more rapidly than others, presenting an opportunity for Space Industrial to invest in high-quality, income-producing MLI real estate, promising strong risk-adjusted returns. The venture will target assets between £10m-£100m and will look to provide capital solutions for Industrial Real estate platforms.”
Riding in tandem for the new cycle
With the new real estate cycle set to start in earnest, capital providers have been trying to find themselves specialist operating partners to aid deployment.
Singapore’s sovereign wealth fund GIC has also embarked on a strategy to aggregate a £500m industrial portfolio in partnership with a new operating partner. It has formed a joint venture with Chancerygate, a specialist logistics asset manager and developer. The Singaporean investor has committed around £250m of equity to the new platform. And logistics stalwart Ian Worboys has secured backing for his new venture, European Green Logistics Space, from Kamco Invest.