Ivanhoé Cambridge Buys Evergreen for $1B

The transaction, which concludes a two-year search for the right industrial real estate company, expands the Canadian firm’s portfolio by 16 million square feet in U.S. assets.

Acquires Evergreen Industrial Properties from TPG Real Estate
Gateway Business Centre, Pinellas Park, Fla.

With the stroke of a pen, Ivanhoé Cambridge has added 16 million square feet of U.S. industrial space to its holdings. The Montréal-based global real estate company just wrapped up the acquisition of Evergreen Industrial Properties, taking the light industrial real estate specialist off the hands of frequent partner TPG Real Estate. Both Ivanhoé Cambridge and TPG are keeping their lips sealed on the transaction price, however, The Globe & Mail reports that the 150-property portfolio traded for $1 billion.

It was a calculated move on Ivanhoé Cambridge’s part. “We started looking at companies in the industrial real estate sector over two years ago with the intention of making a strategic investment in this asset class,” Arthur Lloyd, president, Office North America at Ivanhoé Cambridge, said in a prepared statement. “Industrial real estate offers an attractive current return and good diversification for our office portfolio in terms of underlying economic drivers.”

The trade comes just three years after TPG formed Evergreen, kicking off the company with a 7.5 million-square-foot collection of 59 assets purchased from Prologis Inc. Ultimately, Evergreen’s portfolio evolved into what it is today through a total of 11 acquisitions, including a 1.7 million-square-foot group of industrial properties in metropolitan St. Petersburg, Fla., featuring Gateway Business Centre in Pinellas Park and four other parks.

There will be much more to come from Ivanhoé Cambridge on the industrial front. “We continue to look for opportunities as we plan to grow our industrial business in the years to come,” Lloyd added.

Partnership can have its privileges

Evergreen Industrial was marketed openly, but friendship is likely to have made the path to a deal a bit smoother. Ivanhoé Cambridge and TPG have history; the companies have been on the same side of the table in a bevy of transactions. One of their biggest deals together involves P3 Logistic Parks, a leading European owner, developer and manager of logistics properties. Ivanhoé Cambridge and TPG acquired P3 in 2013, and sold the company in 2016 to GIC, Singapore’s sovereign wealth fund, for $2.7 billion. The sale of P3 marked one of the largest real estate transactions in Europe in 2016.

Image courtesy of Ivanhoé Cambridge