Kennedy Wilson has announced a joint venture (JV) with GIC, a Singapore sovereign wealth fund, to acquire and manage urban logistics properties in the UK.
The JV will be seeded with a $220m (£162m) portfolio which comprises 18 urban logistics assets in prime locations in the UK.
The partnership will reportedly seek additional last-mile urban distribution center investment opportunities, targeting total assets of up to $1bn (£739m).
Mary Ricks, president of Kennedy Wilson, said: “We have witnessed the rapid growth of urban logistics properties driven by strong demand from businesses looking to grow their distribution networks with limited supply of space across major cities in our target markets.
“Over the last five years, we have significantly grown our footprint in this asset class. We are thrilled to partner with a preeminent global long-term investor like GIC to further capitalize on the exciting opportunities in this sector and to build out a premier urban logistics portfolio.”
The real estate investment firm said it will be responsible for the “sourcing, acquisition and management” of the assets and will have a 20% ownership with GIC owning the rest.
Lee Kok Sun, chief investment officer of real estate at GIC, said: “The logistics sector continues to be a long-term area of focus for GIC. We believe the urban logistics sub-market will benefit from positive fundamentals, due to increasing occupier demand driven by accelerating e-commerce adoption and changing supply chain management strategies.
“The Joint Venture’s focused strategy, with the management of a skilled partner such as Kennedy Wilson, is well-placed to capitalise on these trends and generate resilient returns in the long run. This partnership is part of GIC’s broader strategy to invest in this sector.”