GlobeStreet: Scannell Targets Ripe Industrial Market in Europe
Commercial Real Estate reporter Erika Morphy interviewed Bob Scannell about the company's plans to build speculative industrial facilities throughout Europe. Read the full article here.
INDIANAPOLIS, IN, Oct. 25, 2018–Europe is behind the US by several years in industrial activity, but it is poised to catch up quickly, Bob Scannell, President and Founder of Scannell Properties tells GlobeSt.com. As it does, the company refuses to be left behind. So it is making a major investment, setting up operations in France, Germany, Italy, the Netherlands, Spain and the UK. “There will be very similar opportunities in Europe that we are seeing today in the industrial and logistics sector,” he says. “There will be a need for companies like us to identify excellent land positions, to use our own capital to acquire the land and develop the properties and lease them out — basically the same thing we have been doing in the US for quite a while.
A privately-owned development and investment company, Scannell has developed over 270 buildings for clients such as FedEx, Best Buy and GE. Scannell is hopeful that some of these relationships will go with him to Europe. To cultivate local clients it has opened an office in London and tapped Amaury Gariel as Managing Director. Based in Europe, Gariel joins Scannell from CBRE where he has spent 23 years, most recently as Managing Director, EMEA Industrial and Logistics Services.
The company is already close to its first two transactions with land positions, Scannell says. He expects to acquire the land by the end of the year and begin construction in early 2019. One of these projects has had some “advanced discussions” with possible tenants, he says.
Scannell declines to discuss expected returns in part because they vary country by country. “It’s not so much the returns but the spread between the returns to which you build and the cap rates that dictate the value of these buildings. That is what varies among the six countries we are investing in.” For example, Germany tends to be valued quite a bit higher and its cap rates are lower than in other countries.