REPE Fund Profile Series - Part Four: GLP
Each REPE fund profile will briefly summarize each fund’s history, as well as getting into the details of the funds themselves. Our series will also outline a few of each firm’s key real estate equity investments in recent years. By the end of each post, you should have a solid starting point to aid your preparations for your upcoming real estate private equity interviews.
Following on from our focus on the Starwood Capital Group in Part Three of the series, this fourth part will examine the GLP Fund in more detail.
Key facts about GLP
GLP started life as Global Logistics Properties back in 2007 with its main focus on, well, logistics real estate. Founded by Ming Z. Mei and Jeffrey H. Schwartz in Singapore, the firm’s purpose was to buy Japanese and Chinese assets from ProLogis (an American logistics company where Mei and Schwartz had both worked as executives) at the height of the global financial crisis in 2008. That deal was funded by Singapore’s sovereign wealth fund, the Government of Singapore Investment Corporation (GIC)—and GIC still remains the firm’s majority shareholder.
After that deal, GLP grew massively within a relatively short period of time and went public on the Singapore Exchange in 2010, enjoying steady global growth and later going private in 2018. Today, the company focuses on a wider scope of investment activities other than logistics—hence the name change in 2018—but we’ll come back to that shortly.
GLP’s headquarters are still based in its original home of Singapore, and it has a heavy presence in other neighbouring Asian countries such as China, Japan and India. Outside of Asia, GLP has hubs in London, São Paulo, and Chicago—broadening its European, Latin American and North American operations respectively. With 68 offices in total, the firm has an impressive global reach spanning across 17 countries.
What you should know about GLP’s investment process
GLP also invests in the development of technology used for optimizing logistic operations through its Hidden Hill Capital fund, as well as in complementary renewable energy projects and systems.
The firm uses a number of investment strategies across its funds. The leadership team group these strategies into three themed categories—namely Core, Value-Add, and Opportunistic:
Core
This strategy focuses on identifying and investing in high-quality, long-term assets in convenient locations. The goal here is to maintain steady and stable income without too much unnecessary risk.
Value-Add
This strategy centers on looking for discounted opportunities for the team to acquire and manage underperforming, yet well-located, assets. To create value over time, the goal here is to implement the right capital improvements so assets can be sold at a considerable profit later.
Opportunistic
This strategy focuses on straightforward real estate development. Here, the firm aims to develop and sell large-scale, purpose-built logistics assets directly to address customers’ specific needs.
Looking at the business as a whole, you can see that a significant component of GLP’s overall investment strategy lies in its strategic partnerships with other industry giants. Check out an example of this in the CPP Investments & CIC deal outlined in the next section.
Some of GLP’s prominent deals
To understand why a real estate private equity firm invests in the way that it does, it's crucial to examine the challenges and successes of the fund's track record. We’ve outlined some of GLP’s signature deals to get you started below:
CPP Investments & CIC
In 2012, GLP joined forces with the Chinese sovereign wealth fund (China Investment Corporation (CIC)) and the Canada Pension Plan Investment Board (CPPIB) in two separate joint ventures to acquire two logistics real estate portfolios in Brazil for $1.45B in total. Both acquisitions allowed the firm to start its expansion into Latin America.
IndCor
Between 2014-2015, GLP acquired the IndCor warehouse portfolio from the Blackstone Group for $8.1B, increasing its U.S. industrial real estate portfolio by 117 million square feet.
Hillwood Development Co.
In 2016, GLP expanded their U.S. operations even further by acquiring a portfolio including 15 million square feet of warehouses from Hillwood Development Co. for $1.1B. At the time of this deal, GLP was the second largest owner of warehouse assets in the U.S.
Blackstone Real Estate
In 2019, GLP sold 179 million square feet of logistics real estate to the Blackstone Group in a deal worth $18.7B. Out of this square footage, Blackstone acquired 115 million square feet (at $13.4B) for its Real Estate Partners business, whereas Blackstone’s REIT acquired the remaining 64 million square feet for a further $5.3B.
To date, this is the largest private real estate transaction to have ever taken place globally.
Li & Fung
In 2020, GLP teamed up with Golden Lincoln Holdings (the Fung family) to acquire, delist, and restructure Li & Fung, a global supply chain management company, in a deal worth HK$7.2B (around $930M).
Anything else noteworthy?
During the firm’s privatisation process in 2017, GLP’s auction only attracted two bidders— one of which was a consortium of Chinese firms, including GLP’s CEO and other investors. Part of the reasoning behind this was other potential bidders’ suggestions that the CEO and investors’ involvement gave the consortium an unfair advantage in the process.
Over to you...
We hope this GLP REPE fund profile was useful for helping you broaden your industry knowledge in preparation for your upcoming real estate private equity interview.
Now it’s up to you to make sure you have the right interview strategy in place to help you land your dream job. Let’s help you set yourself up for success in your new real estate private equity career: take a look at how we can support you at Leveraged Breakdowns.
About the Author:
Melody Sadé Abeni is a London-based writer who specialises in commercial real estate content. As a generalist member of the Leveraged Breakdowns team, she crafts detailed posts geared towards those curious about the real estate private equity life.
In her former professional life, Melody supported senior corporate executives as a global mobility consultant and did her time in both management consulting and specialist asset management firms.
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