Goldman Sachs Vintage Funds has made a strategic investment in a portfolio of last-mile logistics real estate. The portfolio is part of an investment vehicle owned by Elion Partners that is focused on first, middle and last-mile logistics real estate.
A minority-owned registered investment adviser, Elion recently aggregated a portfolio of more than three million square feet in strategic infill locations including six distribution buildings acquired this year.
“The impact of the crisis has resulted in increased demand for an already active logistics real estate market,” Juan DeAngulo, managing partner at Elion said in prepared remarks. “E-commerce adaptation and the need for supply chain onshoring are both pre-crisis trends that have been accelerated, which have combined with the emergence of increased inventory levels as companies look to mitigate future volatility risk.”
In May 2020, Goldman Sachs announced that it had raised its second dedicated real estate secondaries fund, Vintage Real Estate Partners II with $2.75 billion in capital commitments. The fund invests globally in both traditional real estate limited partnership interests as well as more complex structured and non-traditional secondary transactions, providing liquidity to investors in illiquid real estate assets.
This latest investment follows a reported $500 million stake Goldman Sachs Merchant Banking Division invested in a 46-asset last mile industrial portfolio owned by Dalfen Industrial.
The portfolio of over 6.3 million square feet caters to e-commerce-oriented tenants and is located in Atlanta, Dallas, Chicago, Orlando, Phoenix, Raleigh, Houston, Tampa, Baltimore, Minneapolis, Cincinnati, Columbus, Reno and Jacksonville.
JLL projects that demand for industrial real estate will grow to 1 billion square feet within five years, because of accelerated growth in e-commerce due to the Covid-19 pandemic and the ensuing shelter-in-place policies. E-commerce sales could hit $1.5 trillion by 2025, according to JLL, increasing demand for warehouse fulfillment space and other industrial real estate to an additional 1 billion square feet.