Valor Real Estate Partners (“Valor”), Europe’s fastest growing last-mile real estate specialist, has completed a £101 million debt facility with Canada Life Asset Management. The 5-year investment loan, referenced off gilts, represents the first transaction between the two parties.
The loan is secured against five recently acquired urban infill logistics properties, all located in high demand, critically undersupplied inner London submarkets where the re-allocation of land for residential use has restricted industrial development, pushed down availability and is underpinning rental growth:
- Two previously vacant units on Gemini Business Park in Beckton, East London, where Valor has completed a sustainability-led refurbishment programme, delivering 14,500 sq ft of modern warehousing, leased in October on a 10-year term to Jardine Group. The acquisition extended Valor’s footprint on the park, which benefits from its proximity to the A13 and A406 (North Circular) motorways, to 18 units totalling 348,000 sq ft
- A 21,600 sq ft property in Wandsworth, South West London, acquired from a private landlord and leased to Phase Eight, a British womenswear brand from June 2021, with a rent review due in 2026. This infill submarket has witnessed a steady decline in supply in the past 10 years, underpinning a sub 2% vacancy level
- Four modern distribution assets on the Tera 40 industrial estate Greenford, acquired in August and totalling 341,000 sq ft, which are fully-let to Tesco, Palletways, Royal Mail and Micheldever. The location offers excellent road connectivity via the A40, with the North Circular (A406) and M25 (Junction 16) both within a 15 minutes’ drive time. The Royal Mail asset, constructed in 2018, boasts a BREEAM “Excellent” certification.
- A 31,000 sq ft, single property estate in Canning Town, East London, acquired off market. Comprising four units which are ideally configured for last-mile logistics operators, it is 100% occupied by three tenants with the leases subject to upcoming open market rent reviews and fixed uplifts
- A 112,000 sq ft multi-let estate located in Mitcham,South London, which is currently 72% occupied by three tenants and subject to upcoming open market rent reviews. Valor recently completed a significant refurbishment of the vacant unit, increasing the yard area by 20%. The estate offers direct access to the A23 and A24 – major arterial routes – in less than 10 minutes’ drive
Matthew Phillips, Partner and Head of Finance & Operations at Valor, commented:
“This first transaction with Canada Life Asset Management adds another established global institution to our pool of lending partners. The competitive terms are an endorsement of our strategy which is focused on value-add opportunities and asset mispricing in critically undersupplied submarkets, where evolving consumer trends are driving demand from a range of occupiers. We continue to grow the platform and build relationships with lenders in the UK and in our other core European markets.”
The transaction was led by Mark Dunstan, Director in Canada Life Asset Management’s Real Estate Finance team. The financing supports Canada Life’s annuity business.
Nicholas Bent, Head of Real Estate Finance, Canada Life Asset Management, added:
“We are pleased to initiate a new lending relationship with Valor. This facility demonstrates Canada Life’s ability to secure best-in-class sponsors by providing competitive, flexible terms and meeting ambitious target completion timeframes.
“This sub-50% LTV loan is secured by a portfolio of London logistics assets, a sector underpinned by very strong demand and supply dynamics. We look forward to building the relationship with Valor further as they continue to invest in the UK and Europe.”
Valor was advised by Simmons & Simmons, Ogier (Jersey) and Lockton. Canada Life Asset Management was advised by Stephenson Harwood, Bedell Cristin (Jersey) and Vandenbulke (Luxembourg).