Valor Real Estate Partners (“Valor”), Europe’s fastest growing last-mile real estate specialist, has secured a £64 million debt facility with BGO for the development of a 216,000 sq ft high-specification, sustainable last mile logistics estate in Beckton, East London. It is the first transaction between the two parties.
The 5-year facility will enable Valor to refinance the original acquisition of the 10-acre site and develop four self-contained logistics units ranging from 27,000 sq ft to 80,000 sq ft. Valor is already seeing strong demand for the units ahead of construction starting.
The development, which is due to complete in Q4 2024, is targeting a BREEAM ‘Excellent’ certification and will incorporate market-leading sustainability features including high-efficiency LED lighting, roof-mounted PV panels, occupancy sensors, air-sourced heat pumps, electric vehicle charging points and cycle storage facilities.
Valor assembled the estate via two off-market acquisitions from separate owners and received planning consent for the development earlier this year. It is located at the intersection of the North Circular (A406) and the A13, one of East London’s arterial roads, with a population of 2.66 million accessible within a 30-minute drive time and London’s main business districts the City and Canary Wharf both within 20 minutes.
Beckton is one of Valor’s high conviction sub-markets, and across East London it has amassed a more than 2 million sq ft portfolio since 2016. Beckton is one of London’s most supply-constrained urban logistics locations with c. 2% industrial vacancy and future development set to be restricted by the reallocation of industrial land for housing and other uses.
Matthew Phillips, Partner and Head of Finance & Operations at Valor, commented:
“BGO is a blue-chip lender and their support, secured on attractive terms, is a strong endorsement of our approach in Beckton where we will deliver four market-leading urban logistics units with BREEAM Excellent certification right next to the North Circular. We have seen commitments from a number of strong tenant covenants in the area and anticipate that the supply-demand imbalance will continue to drive rental growth.”
Martin Sheridan, Managing Director, BGO, added:
“BGO are thrilled to be funding Valor and QuadReal on this market-leading urban logistics scheme in London. This deal marks the continuation of our high conviction strategy on the UK and European logistics markets and we are pleased to be executing on this with a best-in-class sponsor group on high-quality, well-located assets.”
Valor was advised by Simmons & Simmons, Ogier, Town Legal,Montagu Evans, Quod and Lockton. BGO was advised by Goodwin Procter, Hollis, Savills and PwC.