By Liza Helps, Property Editor, Logistics Matters

JUST HOURS before the ‘put up or shut up’ deadline on Wednesday, Prologis upped its offer for FTSE listed UK Real Estate Investment Trust (REIT) SEGRO by some 4% on its last offer. This fourth proposal, which Prologis said was its ‘best and final’ offer, values each SEGRO share at 1,031.7p. It values Segro at a 14% premium to its net asset value and a 39% premium over the undisturbed share price – the price per share value before the take-over machine started.

SEGRO had put a valuation of closer to £18bn to accounting for its potential development pipeline and that fact that it thought due to global macro economic issues its shares were trading at a discount. It believed the timing of Prologis original offer was opportunistic and an ‘attempt to buy SEGRO on the cheap’.

There is now a period of discussion and due diligence  between the two companies before a final and binding offer is even put forward and possibly accepted. A deadline of 5pm on 12 August 2026 has been given.

What would this mean for industrial and logistics occupiers in the UK – according to Prologis  it would mean more certainty. It believes that its global platform, balance sheet strength and diversified capital base can unlock the significant embedded value of SEGRO’s development and data centre pipeline.

In a H1 2006 Trading update SEGRO noted that its land bank for industrial and logistics development could provide £429 million of potential future headline rent. It said that in H1 it had already signed deals and transactions worth £53 million in new headline rent and that this included £24 million of new pre-lets signed, with further active negotiations underway, resulting in a record level of projects in the current and near-term pipeline

Currently SEGRO, is the UK’s largest Real Estate Investment Trust, and owns and manages approximately 27 million ft2 of lettable warehouse and industrial space across the UK. In total it manages properties worth around £22 billion. 

Prologis owns and manages approximately 35.3 million ft2 of logistics warehouse space across the UK, spanning 207 buildings.

Combined they would have 62.2 million ft2 of warehouse space in the UK – the vast majority Grade A space. Rough calculations based on total Grade A space of 465 million ft2 nationwide – means the merger could see one investor developer company controlling some 13% plus of all Grade A industrial and logistics space in the UK not including future space under construction, already in the pipeline, or land controlled or under option to be developed.

While  the takeover is unlikely to affect  occupiers directly as such, the wider picture shows that there is weight of capital looking to invest in the UK.

Developer Panattoni, Head of International Capital Markets Nick Cripps, explained: “The proposed takeover at a premium to net asset value confirms there is deep demand for well-located industrial and logistics space, and it is holding up right through the cycle.

“When such a well informed global player is willing to pay a premium for UK and European exposure on this scale, it reinforces the view that international capital still considers this region as one of the most attractive places to invest in the asset class.

“We are seeing the lines between logistics, advanced manufacturing and data centres blurring, which is driving strong demand for modern, high-specification warehouse assets.”

UK-focused real estate investment manager active in ‘last mile’ warehousing and industrial outdoor storage Moorfield CEO and Chief Investment Officer Charles Ferguson-Davie, added:” We have argued for a while that this is an attractive point in the cycle to put money into UK real estate, and a deal on this scale backs that up, even if it is a shame to see another UK company consumed. This transaction should give confidence to others about allocating capital to the UK.”

With more capital looking to invest in the UK, there is a strong possibility that it will be easier to  progress build-to-suit and indeed speculative  warehouse development – both of which have been dwindling of late. Savills latest Big Box research research  noted speculative development was 63% below its 2022 peak and Build-to-suit activity has only accounted for 10% of the market so far in 2026 – well below its long-term average of 37%.