Arab fund, KKR team up with Logos Group for industrial tilt

An artist’s impression of Moorebank intermodal facility.

Logos Group is understood to have teamed up with Kohlberg Kravis Roberts and Abu Dhabi’s Mubadala Investment Company to launch a $1bn fund for Australian industrial assets.

Mubadala, which is thought to have at least $129bn of assets under management, is believed to have been involved in real estate lending in the Australian market of late, but this would be the first foray into the Australian industrial market for the Middle Eastern pension fund.

The understanding is that KKR and Mubadala will be the major investors in the fund, with Logos to take a smaller interest as demand looms large for industrial properties due to the pandemic-fuelled online shopping boom.

Sources say exactly what assets are included in the fund is yet to be determined.

However, the moves come after Logos last year entered exclusive due diligence to buy Qube Holdings’ Moorebank logistics park in Sydney, which is estimated to be worth about $2bn.

A sale of Moorebank is still to be finalised, but most have expected Qube to sell between 50 and 75 per cent of the logistics park’s land trust and warehouse trust to Logos, with Qube to retain the terminals trust.

Logos was always expected to sell down some of the asset to other investors following an acquisition.

Earlier, KKR was in the running to buy the Moorebank park.

The other major industrial portfolio that Logos is competing to buy is Blackstone’s $3.5bn Milestone Logistics Group.

Logos has hired Moelis to work on an acquisition of the business, which is also testing interest for an initial public offering.

Bids are due in the coming weeks, with other groups such as Centuria, advised by Highbury Partnership, and Charter Hall also understood to be fierce competitors for the portfolio.

Blackstone is calling for bids by Wednesday ahead of a second stage in the process before final bids land in the first week of April.

The Moorebank deal, meanwhile, will enable Logos to collect the rent from tenants at the park.

Logos counts as a major shareholder the Warburg Pincus-backed ARA Asset Management, which has $88bn in gross assets under management globally.

Other investors are Canadian real estate investor Ivanhoe Cambridge, which has $C64bn ($67bn) of real estate assets globally, and Logos founders, including joint managing director John Marsh.

The yet-to-be-completed Moorebank intermodal facility, in southwest Sydney, is the largest in the country, with the park covering 243ha.

It is being developed on a precinct comprising land owned by the commonwealth and adjacent to land owned by Qube.

Woolworths is a key tenant.