JV eyes £1bn pipeline of industrial and logistics schemes

Henry Boot has formed a joint venture with an investor to deliver £1bn of industrial and logistics schemes over the next seven years.

The platform with Feldberg Capital and Henry Boot’s property investment and development arm HBD, will be known as Origin and will target mid-box assets. HBD will take a 25% share of the JV and act as the development manager.

To kickstart the venture, three HBD sites in Walsall, Chesterfield and Welwyn Garden City will form part of the portfolio, with a combined GDV of around £100m (HBD share: £25m).

The three sites have the potential to deliver around 450,000 sq ft of prime industrial and logistics space, with construction on each due to commence in H1 2025 for delivery from H2 2025. All developments will target ESG credentials including BREEAM ‘Excellent’ and an EPC ‘A’ rating. The seed assets comprise:

• Spark, Walsall (phase one), a 13-acre development site with a £53m GDV, just off the M6. Spark has full planning consent for phase one, which comprises two units totalling 270,000 sq ft.
• Inter, Welwyn Garden City, a three-acre development site with a £27m GDV on Tewin Road near Junction 4 of the A1(M). The site has detailed planning consent for a 71,000 sq ft industrial and logistics scheme.
• Ark, Markham Vale, a nine-acre development site with a £19m GDV and planning consent for four units totalling 107,000 sq ft. This marks the second phase of HBD’s 200-acre flagship industrial and logistics scheme at Markham Vale.

For each project, development finance will be procured from an external lender. Henry Boot expects the venture to deliver around £1bn of industrial and logistics schemes across the UK over the next seven years.

Tim Roberts, CEO at Henry Boot, said: “The launch of this new industrial and logistics platform with Feldberg Capital is an important transaction for Henry Boot, allowing us to partner with a first-class international investor with the funds and ambition to invest alongside us into one of our key sectors. At the same time, it enables us to accelerate our own £1.3bn industrial and logistics pipeline and in turn recycle capital more efficiently. We now look forward to fulfilling our significant ambitions for Origin alongside the team at Feldberg.”

David Turner, managing partner at Feldberg Capital, said: “Having held back from the industrial and logistics market while assets looked overpriced, we believe now is a highly attractive entry point, with land values having come down over the last 24 months and entry yields being at more sustainable levels.

“The positive tailwinds within the sector remain, driven by structural trends including the continued growth of e-commerce and more firms serving the UK market looking to ‘onshore’ their production here in the face of a shifting regulatory and geopolitical backdrop.

“Our aim is for Origin to become a market leader in the mid-box space. We’re excited to be working together with HBD, using our tried-and-tested ESG framework to deliver the next generation of units for modern, environmentally responsible occupiers, and driving strong risk-adjusted returns for our investors in the process.”