GFH sells Tesco logistics park in UK for US$135 million

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

GFH Financial Group yesterday announced that its UK subsidiary, Roebuck Asset Management (“Roebuck”), has concluded an off-market sale of a Tesco Distribution Centre for over $135 million.

The 540,000 sq ft temperature-controlled centre was originally developed by Tesco in 2010. The warehouse serves more than 400 supermarkets and convivence stores across the South West of England and South Wales forming a crucial part of Tesco’s distribution network.

The sale marks the end of an extremely successful hold period for Roebuck, who acquired the asset for $94 million in October 2017 on behalf of a consortium of institutional Korean investors.

The robust income and significant value increase provided the investors with a post-tax internal rate of return (IRR) of more than 16%, well in advance of the target business plan for such a core asset.

The asset was the second acquisition Roebuck made with South Korean investors and also with Capstone Asset Management. The sale of Tesco Avonmouth follows Roebuck’s 2021 sale of the Accolade Wines, Avonmouth Warehouse for $123m to Tritax Big Box REIT.

Since GFH acquired the majority stake of Roebuck in December 2020, Roebuck has significantly grown in terms of team members and new offices, with more being opened in London and Spain and plans for further office openings over the next 18 months.

With GFH’s backing and support, the intention is to continue to grow assets under management (AUM) and collectively as a group target new acquisitions of c.$500m throughout 2022.

Hugh Brown, the Managing Partner at Roebuck, said: “Roebuck is actively pursuing opportunities to recycle capital from these sales for either UK and European logistics assets.” Nael Mustafa, Board Member at Roebuck Asset Management and Co-Chief Investment Officer at GFH, said: “The strategy is in line with our recent combined sale of the Amazon portfolio in Spain which generated similar returns over a shorter hold period.

While divesting from these assets reduces the immediate AUM, the pipeline identified and secured across Europe will result in a net gain throughout 2022. We look forward to announcing new transactions with Roebuck within the European logistics marketplace.”