GFH Partners Ltd., a DIFC based subsidiary of GFH Financial Group, has completed the acquisition of a US$150 million diversified and multifaceted logistics and industrial portfolio in the Kingdom of Saudi Arabia and includes assets in the United Arab Emirates as well.
The portfolio combines stabilized income-yielding assets and development opportunities that are located in strategic logistics zones and industrial areas in the key cities of Riyadh and Dubai. The portfolio has a mix of light industrial and cold storage facilities, as well as a variety of distribution and warehousing assets that are let to a diversified mix of high calibre, blue chip, international and regional tenants.
The opportunity to invest in Saudi based logistics is driven by the growth of KSA’s non-oil sector GDP which is expected to grow by 5.9% in 2023 and more than 4% in 2023. Similarly, the UAE’s economy anticipates a 3% growth in 2023 followed by a 4% growth the following year, driven by non-oil sectors as well. The continued strength of Dubai’s position as a logistics hub is driven by continued strong demand for container and trade volumes in the key zones of Jebel Ali, Dubai South, and Dubai Investment Park.
In addition to the existing portfolio, the GFH Partners’ GCC logistics platform includes development plans for logistics and light industrial facilities, in partnership with leading local developers, to enable GFH Partners and its investors to capitalize on the continued growth forecasted. The increased retail sales, e-commerce trends, conversion from old to newer and higher quality facilities, and more importantly Saudi Arabia’s Vision 2030 has triggered the Kingdom’s recent announcement of its logistics master plan which calls for the development of 59 logistics centres, with a total area of more than 100 million square meters across the country. Since introducing its Vision 2030 in 2016, Saudi Arabia has financed more than US$1 trillion in real estate and infrastructure developments in preparation for upcoming initiatives to position the Kingdom as a leading global logistics hub. Furthermore, opportunities for growth will also be bolstered by recent agreements reached at the 2023 G20 New Delhi summit in September 2023, whereby Saudi Arabia, the UAE, India, and the US will establish shipping and railway links to connect Europe, the Middle East, and India.
Nael Mustafa, Chief Executive Officer of GFH Partners, commented, “We’re pleased to announce the completion of the acquisition of this portfolio of logistics real estate assets in KSA and the UAE. Combining high-quality, income-generating facilities and development opportunities, the acquisition is well-positioned to capture opportunities arising from the current expansion of the GCC logistics sector. Particularly in Saudi Arabia, where the Kingdom’s Vision 2030 is driving the rapid modernization and development of the country’s transportation and logistics industry to diversify its economy and shift its dependency away from the oil industry. It also leverages GFH Partners’ deep global experience in the sector that has seen us build an exceptional capability and portfolio of blue-chip assets across the GCC, US, UK and Europe.”
He continued, “Further to this acquisition, GFH Partners aims to rapidly expand our GCC logistics real estate platform to SAR 1 billion (US$250 million) over the next 12-18 months, building on growth from favourable demographics, positive momentum in capital markets, and government initiatives to bolster their logistics industries, with Saudi Arabia set to become a key global logistics hub.”
Globally, GFH Partners has successfully acquired more than 50 logistics assets in six countries across three continents. It has deep sector expertise and specialist capabilities and is affiliated to UK-based Roebuck, a leading pan-European asset management company focusing on the UK and European logistics, having transacted over €2.5 billion since its formation in 2009.In recent years, GFH Partners has transacted over US$4 billion in the logistics real estate sector, with units leased to credit-rated tenants, including Amazon, FedEx, DHL, General Mills and Michelin, among others.
GFH Partners is focused on expanding GFH Financial Group’s global asset management capabilities in the real estate sector and currently manages more than US$6 billion of real estate assets as part of the total US$18 billion of assets and funds managed by the Group.
GFH Partners is regulated by the Dubai Financial Services Authority (DFSA), and its investments and offerings are further regulated by respective domiciles, including regional regulators such as the Central Bank of Bahrain (CBB) and the Saudi Capital Market Authority (CMA), as well as respective global regulators of the investment vehicles, ensuring best practices in line with international investment standards.
