4 Nov 2020
M7 & private equity partner commence new Portuguese industrial & office joint venture with €41 million acquisition
M7 secures €20.55 million debt facility in new banking relationship with Novo Banco
M7 Real Estate (“M7”), the pan European investor and asset manager, announces that it has acquired ten industrial and office assets in Portugal via two transactions for a total of €41 million, on behalf of a new joint venture, the Portuguese Investment Fund (“PIF” or the “JV”) with a major, global private equity firm.
Portuguese bank, Novo Banco, has provided a €20.55 million loan facility to finance the acquisition of the portfolio, marking a new banking relationship for M7.
PIF targets primarily logistics and office assets in Portugal with M7 acting as both investment and asset manager. The vehicle is M7’s second in Portugal where it manages a total of €132 million of assets, including on behalf of the M7 Portuguese Active Fund (“M7 PORAF”), which targets value add real estate opportunities in regional Portuguese markets and is fully invested.
The c. 85,600 sq m portfolio, acquired by M7 on behalf of PIF, was assembled through two separate transactions and comprises five last-mile logistics assets predominantly located in Lisbon and Porto; three office buildings in Lisbon; and two solus retail warehouse units in Greater Lisbon and Madeira.
M7 will implement an active asset management strategy to lease up the vacant space across the portfolio, which is 95% let, and grow rental income, taking advantage of low vacancy rates in the Lisbon office and industrial markets and the robust demand for industrial space in areas of strong connectivity from the rise of e-commerce.
David Ebbrell, Chief Executive of M7 Real Estate, commented: “The formation of PIF with our partner and the establishment of a new banking relationship with Novo Banco mark significant strategic milestones for M7, as we continue to grow our business internationally.
“We have a long-standing track record in successfully co-investing alongside our joint venture partners to execute and deliver on strategies which play to our niche and in-depth market expertise. The initial portfolio we have assembled for PIF presents an attractive opportunity to add value through intensive asset management, which will be led by our local team on the ground in Lisbon.”
Hugh Fraser, at M7 added: “To have the support of Novo Banco on these transactions is a fantastic endorsement of both the opportunity there is to create value at these assets and the track record we have built up in the Portuguese market over the last two years. I look forward to working with them as we continue to grow the portfolio and deliver on our asset management strategy.”