InfraRed Capital Partners, on behalf of its Active Real Estate Fund III (“InfraRed”), has recently exchanged contracts to sell a portfolio of UK light industrial assets (the “Powerhouse portfolio” or “the portfolio”) to real estate funds managed by Blackstone (“Blackstone”) and M7 Real Estate.
The portfolio comprises 4.5 million ft² of light industrial space across 40 properties located mostly in the North West & the Midlands along the M6 corridor. InfraRed created the Powerhouse portfolio through multiple acquisitions, the first of which took place in 2014.
InfraRed selected the underlying properties because of compelling supply-demand fundamentals locally, strong income profile and opportunities to enhance value through vacancy reductions, lease extensions and refurbishments.
James Cooper, Director, Real Estate at InfraRed Capital Partners commented:
“InfraRed has been investing in the light industrial sector since the mid-1990s and we are delighted to have successfully completed the aggregation of this regional portfolio over the last 4 years. We have added significant value to the portfolio through asset management initiatives - during our hold period we increased the portfolio income by approximately 20% through completing a good proportion of our asset management initiatives ahead of time. The UK Industrial market remains highly sought after by investors seeking defensive income underpinned by a shortage of available space plus the ongoing expansion of e-commerce and last mile delivery. This sector remains a core part of our pan-European investment strategy”
InfraRed were advised by Dowley Turner Real Estate, Osborne Clarke and Taylor Wessing.