SPAIN - Transport
Managing Director Spain, P3 Logistic Parks
Javier Mérida is Managing Director of P3 Logistic Parks in Spain and is part of the Group’s Management Team. Previously at P3, he held the position of Head of Asset Management & Acquisitions for the Spanish market for nearly four years. He has extensive experience in the logistics and real estate sectors, having worked for large companies such as Zaphir Asset Management, BNP Paribas Real Estate and TPG Almindus. He has a degree in Economics and Business Administration from the Universidad Complutense de Madrid and an MBA with first class honours from the IEB.
The origin of P3 was in the Czech Republic, where it was a relatively small company that grew in Europe. Until 2014 or 2015, it went through several stages of development and mainly grew in Eastern and Central Europe. We were incorporated into the company when it was owned by TPG and Ivanhoé Cambridge, and at a different stage of development. The company was then buying portfolios and growing in Eastern Europe. We started operations in Spain in 2014 with the purchase of a portfolio of four industrial units. The first office was established in 2016, but after 2016, we started with full operations in Spain buying other portfolios and developing turnkey projects, whereupon the company was acquired by GIC. GIC is an important partner at a financial level with a long-term ownership view. Since then, we have grown in every country, but fundamentally in Germany, Spain and Italy, and we have consolidated our position in the Czech Republic. Meanwhile, we have also increased our investment in the Netherlands, and opened operations in Austria. In Spain, we have established a structure from scratch. We have developed 250,000sqm of new logistic platforms, making for a total portfolio of around 625,000-650,000sqm.
6.2 million sqm, given that growth has been rapid. This year we have conducted certain large operations in Central Europe, mostly in Germany, the Czech Republic, the Netherlands, Slovakia and Austria. We have realized certain operations of over 1.5 million sqm, which again, has translated in to rapid growth. In Spain we have the aforementioned 650,000 sqm, and are developing an additional 100,000 sqm on top of that.
Most of our new developments in Spain have been built-to-suit projects. In Illescas, we developed our logistic park in three different phases: the 1st phase was a building for Amazon, 2nd phase for Airbus and the 3rd phase was compounded by 2 speculative projects, one of them occupied by Correos Expres. Part of the space in the park is already rented, and others will be over the coming months.
We are going to continue with a mix, with a number of tailor-made projects for certain clients. Meanwhile, we will continue to launch speculative projects for mature markets with a high level of demand.
The pandemic has been a challenge for every sector. However, we should not forget that logistics is related to everything that we consume on a daily basis. In that regard, logistics is related to the supply of many items, from cutlery for hotels to the components for car manufacturing. So everything that impacts consumption and sales has an impact on our clients. Our tenant mix has some clients that have not been affected, while others have been. It has been a challenging year, but has not been a negative one in terms of results.
I think that what makes us different is our long-term strategy. All our investments are for the long-term, including the acquisition of land or assets.
The Mediterranean Corridor is one of the hubs in which we are seeking to expand. That includes all Catalonia, from Gerona to Tarragona, and Valencia including Castellón and Alicante, Malaga, and there are new logistic spaces that are being open that continue to increase the demand of companies, so we perceive much growth potential in the Mediterranean Corridor.
We have a different view of the last mile, compared to the rest of the sector. We are seeking projects with a large plot of land, where large vehicle traffic can be handled. One of the characteristics of last mile is that it generates a lot of traffic. We are seeking large plots of land within cities that offer large spaces able to manage that high level of traffic and that are well connected to the main highways.
I think that traditionally there have been some stereotypes related to logistics. It has been seen as an industry with negative externalities, due to pollution, the traffic it generates and because it allegedly generates low paying jobs. I think that vision is changing. The pandemic has somewhat contributed to that because it is essential to have a strong logistic sector to overcome the adverse situation that we have experienced. Logistics have demonstrated to be very important during the pandemic. The jobs that logistics creates have more added value.
This is more of a gradual process that will reflect in certain strategic projects. Now we are better aware of the problems that can emerge if we bring everything from Asia. We have seen that some supply chains can be broken in light of an emergency like the one we are experiencing. I think that we will probably see an increase in storage capacity. There could be more storage capabilities close to consumption points. We will probably see a lower dependency from the manufacturing perspective, as a result of an increase in storage capacity. I think that this will be a step taken before industries relocate to Europe. This increase in the storage capacity will improve emergency response.
We still plan to grow, with continued investment in the logistic sectors, which we see as one of the core industries of the next year’s economic growth. We want to develop our own parks, and that’s something that we will continue to look into. And meanwhile, we are evaluating the possible purchase of new portfolios.
SPAIN - Real Estate & Construction
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