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LaSalle Acquires Logistics Property for Development in Madrid

LaSalle Investment Management has acquired the Villaverde Logistics Portfolio, comprising two new state-of-the-art logistics development projects located in Villaverde, a southern district of Madrid.

The developments are targeting a BREAM Excellent sustainability standard. The developments, located  at Calle San Dalmacio 17 and Avenida Real de Pinto 83 logistics parks, have been acquired via a forward funding agreement from Engel & Völkers Development Spain. Completion of the two developments, which are being delivered by their former owner, is scheduled for Q1 2023.

The district of Villaverde is an attractive logistics location on the southern outskirts of Madrid, benefitting from excellent transport infrastructure, its industrial zone is surrounded by major roads allowing rapid access to several highways and strong connectivity to the city centre, as well as neighbouring municipalities and logistics hubs along the A-4 route. The site itself is particularly well connected, including via the adjacent metro station and Avenida de Andalucia, the main North-South road artery bisecting Villaverde. The scheme will entail the development of a modern Class A logistics park designed for multi-let occupation. The modular design and smaller configuration of individual modules offers occupiers greater flexibility, particularly for smaller to medium-sized firms.

The acquisition demonstrates again the ability of the Fund to invest in value add opportunities in exciting urban locations.  It also marks the return of Encore+ to the Spanish logistics development , following the successful sale of Alcala and Azuqueca De Henares in 2016. Villaverde’s attractiveness as a location and the growth in demand for last-mile facilities, particularly from e-commerce operators, combined with an extremely limited supply of both, available development land and modern suitable stock, are likely to maintain upward pressure on rents for the right quality stock.

Francesco Coviello, head of investment for CEE and Southern Europe at LaSalle Investment Management, said: “We are pleased to be forward-funding the development of these properties, in a very well-connected urban location serving a major European capital, as we continue the build-out of a prime European logistics portfolio. Overall, Spanish logistics assets have performed very well in recent years and we expect continued upward pressure on rents.”

LaSalle was advised on this transaction by Hogan Lovells on the legal and tax side and JLL and Tauw on the Technical and Environmental side.