Hines European Core Fund - HECF

Cargo Point – London, UK

Prime Logistics portfolio providing critical infrastructure for Heathrow’s ‘off-cargo’ operations.

Description

Solely occupied, and independently acquired, logistics assets collectively representing one of the largest consolidated industrial aggregations in Heathrow.

In 2020 and 2022, the Fund acquired two assets adjoining the cargo centre entrance of the busiest airport in the United Kingdom. The portfolio possesses strong rental growth prospects due to its prime location within a highly supply-constrained market. Due to strict zoning policies, the surrounding areas are restricted with limited land for development. Since acquisition, the Fund has substantially improved the terms of the leases in place while making progress on its decarbonization strategy.

Heathrow Airport accounted for 72% of all UK air cargo in 2022, equivalent to 21% of all UK trade by value¹. Heathrow’s freight volume increased by 15% from 2019 to 2022, and when combined with the increased e-commerce penetration, provides a positive outlook for Heathrow’s cargo capacity. This defensive portfolio is likely to provide a stable, long-term, and secure cash yield, with rental growth prospects driven by the prime location and limited supply pipeline.