ESR Europe secures €118m NatWest refinance for UK logistics fund

Real estate investment manager ESR Europe has secured a new £103.3 mln (€118.3 mln) loan from NatWest for its Urban Logistics Income Fund (ULIF). 

ESR Europe ULIF refinance

This refinancing deal is expected to improve the fund's performance and demonstrate the strong value of its properties.
The ULIF portfolio consists of 15 urban logistics properties in prime UK locations, mostly in and around London, with others near Manchester, Birmingham, and Sheffield. These properties are fully leased and generate income. ESR Europe has actively managed these assets since acquiring them, boosting rental income and improving their ESG features. This strong portfolio and management strategy helped them secure favourable loan terms.
The successful refinancing also highlights the robust nature of the urban logistics market. This sector is thriving due to long-term trends like increasing online shopping, consumer demand for fast delivery, and changes in supply chains. These factors are driving consistent demand for strategically located last-mile and urban distribution centres. With limited availability in major urban areas, ESR is well-positioned to capitalize on these trends, providing stable income and long-term rental growth for its investors.
Henry Giles, managing director, Fund Management and fund manager for the Urban Logistics Income Fund at ESR Europe, commented: “This refinancing marks an important milestone for the Fund, exceeding our original underwriting assumptions. It strengthens our relationship with a valued lending partner and rewards the efforts of our in-house asset and property management teams. As active managers, we continue to identify opportunities to capture income reversion across this high-quality portfolio, supporting further outperformance in the years ahead. Urban Logistics remains one of our highest-conviction investment themes in Europe.”
Roger Bozon, director, Real Estate Finance at NatWest, commented: “NatWest is delighted to support ESR Europe in the successful refinancing of the ULIF portfolio. We have a long history of working together in the sector and great confidence in ESR’s investment and asset management capabilities. We are proud to support leading sponsors through financing high-quality real estate, so we are grateful for ESR’s continued trust, and look forward to further strengthening our partnership.”