Saudi-backed Oryx plans logistics centre in UK

Oryx

• Five-acre site purchased
• UK market recovering
• £2.5bn from Gulf in 2024

Oryx Real Estate Partners, a UK-based investment and asset manager, has acquired a five-acre development site in Milton Keynes on behalf of a consortium of GCC family offices, mainly from Saudi Arabia. 

The company, whose chairman and co-founder Fawaz Al Rahji is also chairman of Saudi family office Al Rahji Partners, plans to invest between £25-£30 million ($31-$37 million) redeveloping the site into a 10 million square metre logistics hub. 

The value of the deal, Oryx’s first logistics acquisition, was not disclosed.

The company is targeting the sector’s high income growth prospects and strong occupier demand. 

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Following a slowdown in UK commercial real estate due to high interest rates, inflation and the pandemic, the market has started to recover led by the industrial and residential sectors. 

Average rental growth for UK industrial is expected to reach around 4.2 percent in 2023, according to consultancy Knight Frank. This is below the levels recorded over 2021-2022 but in line with pre-pandemic years. 

There continues to be a strong appetite for UK real estate among Middle Eastern investors, driven by falling UK property prices, favourable exchange rates and rapid economic growth in the GCC. 

Investors from the region are expected to pump £2.5 billion into UK property in 2024, according to Bank of London and the Middle East. 

Oryx was founded in 2019 by Al Rahji and managing partner Johan Eriksson, who previously worked for a subsidiary of the family office. 

Oryx advises international investors seeking to allocate capital to UK and European real estate and sets up vehicles for acquisitions. A planning application has already been submitted for the Milton Keynes site, acquired from distribution company WH Barley. Pembury Real Estate is the development partner.

“After a period of being active in the logistics market, we exited our positions in 2020,” Al Rahji said.

“Following the correction in land values over the past years and the continued potential of rental growth, we believe it is an opportune time to re-enter the market. 

“We value the UK real estate market highly due to its landlord-friendly legislation, long standing international interest and attractive opportunities arising due to liquidity requirements and growing distress. This sentiment is shared by our clients.”