PGIM Real Estate's U.S. Sustainable Investing Strategy Selected as Winner of PREA 2024 ESG Momentum Award
The PREA ESG Momentum award recognizes industry-leading and innovative approaches to ESG issues among real estate strategies.
Jul 6, 2020
4 mins
PGIM Real Estate has acquired five logistics assets in Germany on behalf of the investors in its European core strategy: Cargo City South, a logistics and office property near Frankfurt Airport and a portfolio of four logistics properties in the Berlin metropolitan area. PGIM Real Estate is the real estate investment and financing business of PGIM, the US$1.3 trillion global investment management business of Prudential Financial, Inc. (NYSE: PRU).
“With these acquisitions, we have achieved our aim of allocating a high proportion of the fund’s assets to logistics,” said Thomas Kallenbrunnen, senior portfolio manager for PGIM Real Estate’s European core strategy. “The transactions play to our defensive investment philosophy regarding the European market and support our aim to deliver long-term outperformance with low volatility through cashflow diversification. The proximity of the assets to major consumer hubs increases the already high resilience of our portfolio in the current COVID-19 induced market uncertainty.”
The team continues to build exposure to logistics in the long term, against the backdrop of increasing online-retail-related demand and a shifting trend for industrial companies to carry larger and more robust inventories as part of their supply chain management.
Cargo City South
With almost 8,000 sq. meters of rental space, Cargo City South is located next to the new Terminal 3 at Frankfurt Airport, benefitting from 24/7 customs accessibility and a desirable location for delivery services. The property has attracted top tenants and is 91% leased. The location benefits from direct access to the airport and strong public transport connections, making it a highly unique location to service the demand for logistics and logistics-oriented office space.
Berlin Portfolio
With over 100,000 sq. meters of floor space, the properties offer attractive logistics capacities in the districts of Ludwigsfelde, Großbeeren and Freienbrink. The area has strong transport connections with direct access to major highways offering direct distribution to the city and region. Throughout Germany, the logistics sector continues to record steady rental growth, with Berlin recording above-average rental growth. This is further supported by population growth and a shift to e-commerce fueling demand in these consumer-oriented locations.
The PREA ESG Momentum award recognizes industry-leading and innovative approaches to ESG issues among real estate strategies.
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