Cromwell, IGIS seed logistics fund with $83.3m northern Italy portfolio

ASX-listed Cromwell Property Group with Korea’s IGIS Asset Management has settled on the A$83.3 million (€51m) acquisition of seven DHL-occupied distribution centres in northern Italy.

The portfolio’s Weighted Average Lease Expiry is 16 years.

Two of the complexes are new; the rest have only ever been utilised by the logistics group.

The assets are near Milan, Turin, Bologna and Verona.

DHL is headquartered in Germany’s Bonn.

Properties will seed Cromwell European Logistics Fund

“In accordance with our ‘Invest to Manage’ strategy, we will look to use these assets to seed our upcoming Cromwell European Logistics Fund,” Cromwell chief executive officer Rob Percy said.

“Logistics is a sector that we think has strong and enduring characteristics (story continues below).

“Online sales rates in Europe currently average just 8.8 per cent,” the executive added.

“This is comparatively low when compared to other advanced economies albeit the volume of online transactions is forecast to almost double over the next decade.

“If anything we believe COVID-19 is likely to accelerate changes in consumer behaviour and pull this growth forward, giving further impetus to the broader logistics sector and last mile logistics in particular.

“The fund will therefore have multiple different growth avenues to realise value.

“These include infrastructure (re)developments, which open up new locations and expand existing ones; a low sub-5pc market vacancy rate, which provides opportunities to capitalise on future rental growth; and lastly, the need to replace and upgrade existing stock to satisfy pent up and growing demand for assets in the right locations”.

Cromwell is eventually aiming to retain a 20pc stake in the fund, Mr Percy said.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of