Logport Development and Invesco Real Estate have teamed up and, via a forward funding structure, committed to developing a 37,900 sqm Grade A last-mile logistics facility, Logport Prague West, strategically located adjacent to the Prague ring road. The transaction was mediated by Cushman & Wakefield. Logport Prague West, where construction started in September 2022, has already attracted the first tenants to move in during the summer of 2023. The entire commercial zone is scheduled for completion in Q1 2024.
Constructed by Logport Development, the state-of-the-art city logistics facility consists of 11 separate units to be completed by Q1 2024. The commercial zone is going to be truly multifunctional as it combines space for logistics and light production, offices and showrooms. Seven units – called LogSpace – will be ready for distribution, warehousing and light production; the remaining four – called LogBox – will be a highly flexible blend of smaller warehousing, office and showroom/retail assets. More than half of the space has already been pre-let to a range of prime tenants and further intensive business negotiations are underway.
The project will be the first property in the Czech Republic to be rated BREEAM In-use Excellent post completion and BREEAM New construction Very Good. A key aspect is its energy efficiency and maximum use of alternative energy sources. The sustainability attributes include the extensive use of solar panels, green façades, rainwater retention and greywater use.
Located adjacent to the main Prague ring road, the logistics park will serve as a last-mile distribution channel, with approx. 1.3 million inhabitants within a 30-minute drive and a major domestic distribution centre through main Czech national road and rail routes.
Henry Grant, Director of Fund Management at Invesco Real Estate, said: “The continued pressure on global supply chains, further forecast e-commerce penetration and the supply-demand imbalance for newly-built last-mile logistics space serving Prague makes for a highly compelling investment case to drive long-term outperformance. Partnering with logistics specialist Logport will ensure we deliver a best-in-class, sustainability-led last-mile logistics park. We are delighted to have secured this logistics development for one of our long-standing US clients, which plans to further grow its European real estate exposure.”
“Such opportunities are a rare commodity in the Czech Republic and even more so in Prague, due to a stringent planning system. However, with high demand from tenants, we expect the last-mile sector to grow significantly. Prague is a major driver of the Czech economy, and its inhabitants represent the wealthiest segment, ranking third by GDP per capita in terms of purchasing power in the EU,” concluded Tomáš Pícha, Senior Director – Transactions, CEE at Invesco Real Estate.
“We are proud to announce the conclusion of the transaction with Invesco, the leading international asset manager. We view their interest in the Logport Prague West project as confirmation of continued investment appetite for top-notch commercial projects. The prevailing strong demand from tenants confirms both the wisely developed concept and the favourable timing of this project. We are confident that the successful completion of Logport Prague West shall create a strong basis for future potential cooperation with Invesco,” added David Vais, CEO of Logport Development.
Michal Soták, Partner and Head of Capital Markets at Cushman & Wakefield, who mediated the transaction, added: “Prague’s urban logistics market has shown the highest rental growth among major European cities in both 2021 and 2022, thanks to exceptionally strong tenant demand and almost non-existent supply. Therefore, acquiring a prime asset in this highly supply-constrained market is exceptionally difficult and forward funding a developer is effectively the only way for an investor to buy into this sector.”
