12 December 2006 - Macquarie Global Property Advisors (MGPA) has signed an agreement on behalf of MGP Fund II to purchase a portfolio of eight light industrial assets in Germany, for an initial yield of above 9%.

With seven of the properties located in Stuttgart, the portfolio comprises 63,000 sqm of space, of which over 98% is leased with a number of the tenants coming from the automotive industry. The portfolio consists of 75% light industrial space and 25% office space. 

MGPA Managing Director Alex Jeffrey said, “This is an excellent investment for the Fund as it was acquired for significantly less than replacement cost and is a high-yielding light industrial portfolio in one of the most vibrant industrial regions in Germany.

“We are very positive about the German real estate market at the moment with the economy continuing to gain momentum.  In particular we see significant opportunity in the light industrial sector which is emerging as an institutional asset class offering the potential for further yield compression.  

“Historically the light industrial property sector has been dominated by owner-occupiers but this is shifting as companies are finding they increasingly need more flexibility and are choosing to lease rather than buy space.”

MGPA’s Head of Acquisitions for Germany Marius Schöner said, “The Stuttgart-Heidelberg economic corridor is among the strongest economic zones in the country.  It is also one of the most important industrial regions in the automotive industry in Europe being home to DaimlerChrysler, Porsche and Bosch.

“We’ll be applying our active asset management expertise and experience to this portfolio to ensure that we extract full value from these properties for our tenants and investors.”    

MGP Fund II has already acquired two properties in Germany this year as part of its acquisition of the Sony Portfolio. These properties are in the office and warehouse sectors and have a combined area of 52,700 sqm.