Oxford Properties Group and Logistics Capital Partners have formed a new co investment joint venture, to acquire a 734-acre site near Birmingham, which they will develop into a major new logistics hub with associated rail freight terminal known as West Midlands Interchange.
Oxford and LCP will jointly invest c. £1bn to bring forward the project over a number of years, Oxford will provide the majority of the capital with LCP’s team acting as development manager.
West Midlands Interchange will be a technologically advanced development with planning consent already secured by the vendors, which allows for the delivery of around 8 million sq ft of prime logistics space.
James Boadle, Head of Logistics and Residential, Europe at Oxford Properties, said: “In recent years we have significantly increased our exposure to the logistics sector globally through several major transactions, including making our first direct investment into European logistics last year with LCP. Logistics remains one of our highest conviction calls globally, benefitting from substantial undersupply of prime new space while the growth of e-commerce and demand for expedited supply chains continues unabated, accelerated by the effects of Covid-19.”
“The transaction represents a rare opportunity to gain significant exposure at attractive risk-adjusted returns in an increasingly competitive landscape.“
The site can accommodate new warehouses ranging in size from 200,000 sq ft to over 1 million square feet, with building heights up to 30 metres.
The scheme will create 8,500 jobs and a further 8,100 indirect jobs, It is also expected to generate around £430m of local economic activity each year, and, through the supply chain, create over £900m of economic activity each year nationally.
As part of wider infrastructure improvements, Oxford and LCP will build a new link road to connect the A5 and A449. In addition, the project will create a new Strategic Rail Freight Interchange, which will provide intermodal access for occupiers.
Infrastructure works are expected to commence in the first half of 2022 with completion in 2023.
