E-Shang Redwood scores $100M from Azerbaijan fund for Japan projects SOFAZ has US$34 billion in assets under management
Asian logistics warehouse operator e-Shang Redwood has raised US$100 million investment from the State Oil Fund of Azerbaijan (SOFAZ) to back warehouse development projects in Japan, the firm announced today, ChinaMoneyNetwork reports.
The investment came one month after a group of Chinese investors, including GF International Investment Management Ltd., Huarong International, China Everbright Ltd. and CMBC International, invested US$300 million in e-Shang Redwood as it prepares for an initial public offering this year.
The company also agreed to buy an 80% indirect stake in the manager of Cambridge Industrial Trust from National Australia Bank and investment firm Oxley Group last month.
In the latest investment, SOFAZ is injecting the capital in order to capitalize the gap of supply and growing demand for modern warehouses in Japan, where less than 10% of total market supply are modern warehouse space. That combined with the country's stable overall economy has driven steady growth in the third-party logistics sector and made it an attractive investment for investors.
"We are excited to build upon the relationship with SOFAZ, the Sovereign Wealth Fund of the Republic of Azerbaijan. Over the last 3 years, SOFAZ has displayed both insight and acumen through their impressive series of Asian-focused investments and selection of product classes witnessing the highest demand and growth in the region," said Charles de Portes, president of e-Shang Redwood and Stuart Gibson, co-CEO and head of its Japan operations, in a statement.
"This investment is consistent with our strategy of identifying through rigorous diligence and then committing to the most compelling and focused strategies by geography and asset class. Development of state-of-the-art logistics real estate in Japan, which has witnessed increasing levels of demand associated with growth of e-commerce industry particularly in Tokyo and Osaka is such a strategy and complements well our existing real estate portfolio," said Shahmar Movsumov, executive director of SOFAZ.
e-Shang Redwood, also known as ESR, was initially founded in 2011 by Warburg Pincus and two Chinese entrepreneurs. It has grown rapidly via acquisitions and massive institutional investments to become a pan-Asian warehouse developer with 7.3 million square meters of projects owned and under development across the region.
SOFAZ, established in 1999, is a sovereign wealth fund located in the port city of Baku, Azerbaijan. The main responsibility of the fund is to manage foreign currency reserves generated from the sale of oil and gas. SOFAZ has US$34 billion in assets under management, 10% of which is allocated to real estate investments.
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