The Sydney-headquartered firm is seeking $400 million for a Vietnam vehicle and another $800 million for South Korea for its build-to-core strategy.
The development was first reported by PERE on Thursday. Trent Iliffe, managing director and co-CEO of LOGOS, confirmed the plan to DealStreetAsia.
In the past, the firm has secured capital from strategic investors such as the Canada Pension Plan Investment Board (CPPIB), Ivanhoé Cambridge and Dutch property fund manager Bouwinvest in raising funds for its ventures in China, Indonesia and Singapore.
“Vietnam came on the global stage about two years ago. We were first asked to come to Vietnam to support one of our major customer’s interest in Ho Chi Minh City. As we opened the door with other customers, our commitment to set up in Vietnam was resolute as the needs of these companies became evident,” Iliffe said in an email interaction.
The growth potential of the Southeast Asian country is also driven by market fundamentals, including the trade war, the decentralisation of the global supply chain, as well as growth in the e-commerce market, he said.
LOGOS appointed Glenn Hughes, former director of capital projects and infrastructure at PwC Vietnam, as its Vietnam country head in January this year.
Meanwhile, Korea spells an opportunity for LOGOS because apart from ESR/Kendall Square, “there are no other international or regional development groups” in the country, said Iliffe.
“We have a number of our customers asking us to come and support their growth in Korea and are excited by the future opportunities here,” he added.
LOGOS will focus on acquiring and developing assets that support the core logistics sectors of e-commerce, food and cold storage. “We will need to build this product from the ground up to meet the needs of the modern logistics sector requirements,” Iliffe revealed.
These two Asian markets have become appealing to logistics real estate investors in the past couple of years. ESR Cayman recently invited CPPIB and Dutch pension fund APG to set up another $1 billion joint venture to invest in Korea’s industrial properties.
In Vietnam, BW Industrial, a joint venture between private equity firm Warburg Pincus and local property developer Becamex IDC, claims to be the largest industrial platform in the country with about $215 million in capital.
Meanwhile, global logistics giant GLP set up shop in Vietnam earlier this year, with Kent Yang, its former China president, and Chih Cheung, a Li & Fung board member, as its founding partners, Mingtiandi reported.
Older players in Vietnam’s industrial real estate scene include VSIP, a joint venture between Becamex and Singapore’s Sembcorp Development, and overseas conglomerates who have massive investments in the country.
Addressing competition in sourcing deals, Iliffe said, “There will always be strong competition in any market, the value is understanding customer needs in terms of location today and in the future. Where possible, we like to acquire land with customer support. We are comfortable on our ability to deliver in these markets.”
LOGOS might also look at Japan and Thailand as its next expansion targets, according to PERE.
The firm’s Korea and Vietnam expansion strategy comes on the heel of deployment of a $400-million Indonesia vehicle last year and the first close of its fourth China logistics venture at $800 million in April 2020.
Established in Australia in 2010 by founders John Marsh and Iliffe, LOGOS was acquired by ARA in March this year to become the latter’s exclusive platform for logistics assets globally. By June, LOGOS had over 6 million square metres of property owned and under development, with a completed value of A$10 billion ($7.16 billion) across 20 ventures, including the Singapore-listed ARA LOGOS Logistics Trust.