Prologis ups commitment to China logistics venture

Prologis committed $132 million and the rest came from HIP China Logistics Investments, a subsidiary of sovereign wealth fund Abu Dhabi Investment Authority (ADIA). According to a statement, the new round raises the venture's total committed equity to $2.6 billion, 85% of which was committed by HIP and the rest by Prologis.

Prologis also announced the signing of lease agreements with six customers for a total of 2.1 million square feet. Half of the customers are new, and the rest are returning.

Formed in 2011, the joint venture has a remit to build, acquire and manage logistics properties in China. It has raised four rounds of capital commitment from HIP and Prologis since it launched, including a $588 million investment in July 2014, of which $500 million came from HIP. The latest round is expected to fund the company for the foreseeable future.

Rising demand from online retailers and domestic consumption, and a lack of high-quality supply, have spurred investment by private capital in China's logistics sector. Canada Pension Plan and Investment Board (CPPIB), for example, established a logistics-focused joint venture with Goodman Group in 2009 to which the two have committed capital regularly, including a $1.25 billion commitment last year.

As of December 2015, Prologis owned or had investments in properties and development projects totaling about 669 million square feet in 20 countries. The company leases distribution facilities to more than 5,200 customers, including third party logistics providers, transportation companies, retailers and manufacturers.

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• Topics
• Greater China
• Expansion
• Support services
• Infrastructure
• Investments
• China
• Infrastructure
• Growth capital
• PIPE
• Logistics