(VIANEWS) SINGAPORE, 20 JANUARY 2022 – The entire portfolio of the Singapore-based Elite Partners Capital, a European logistics real estate fund, was sold for €520 million to a fund run by the US private equity company Blackstone Group.
Elite Logistics Fund I is a two-year closed-end fund that debuted in early 2020 on the private market exchange ADDX. ADDX is a full-service capital markets platform with licenses from the Monetary Authority of Singapore (MAS) for digital securities issuance, custody, and secondary trading.
With the sale of all 18 properties to Blackstone, Elite’s fund has earned annualized returns that are more than double its aim of 12 percent per year.
In June and December 2020, individual accredited investors on ADDX subscribed to the Elite fund in two different offers. ADDX tokenized the fund units, and thanks to the effectiveness of blockchain and smart contracts, the minimum investment size imposed by Elite was reduced to EUR 20,0002 from EUR 1 million.
The sale to Blackstone resulted in 98 percent of the proceeds going to ADDX investors. After the fund is formally closed later this year, the leftover funds will be distributed.
The demand for space in logistics and e-commerce facilities skyrocketed as a result of the pandemic, according to Enoch Tan, Portfolio Director of Elite Logistics Fund I.
Supply chain disruptions prompted companies to increase inventory levels for food, essential goods, and other consumer products to ensure they could meet demand consistently. The facilities at Prague airport’s cargo terminal were used for vaccine storage and delivery.
Travel limitations, which went into effect in early 2020, made real estate transactions difficult in the fund’s early stages when it was acquiring warehouses.
Two variables, according to Tan, helped to alleviate this. First, by the end of 2019, the fund manager had physically visited a substantial number of the properties before travel to Europe became problematic. Second, despite having full-time workers in the UK and Europe, Elite was able to rely on strategic partner Macquarie Capital Principal Finance. It was also a major investor in the fund, to follow up on transactions in person because Macquarie had a European network of offices and personnel.
The fund manager’s Singapore-based members had to use Zoom to track site visits and tenant meetings, which was a novel kind of real estate appraisal made necessary by the epidemic.
Global wealth portfolios were rebalanced, in favor of logistics real estate as the pandemic progressed. Investor demand for assets increased dramatically, resulting in higher valuations and contributing to Elite Logistics Fund I’s larger-than-expected returns. Tan remarked.
Elite is a Singapore-based alternative asset management firm that manages over SGD 1 billion in assets. Elite Commercial REIT, which is currently listed on the Singapore Exchange, is one of the portfolios Elite has put together.
