Some embodiments provide a managed network for implementing a logical network for a tenant. The managed network includes a first set of host machines and a second set of host machines. The first set of host machines is for hosting virtual machines (VMs) for the logical network. Each of the first set of host machines operates a managed forwarding element that implements a first logical router for the tenant logical network and a second logical router to which the first logical router connects. The implementation of the second logical router is for processing packets entering and exiting the tenant logical network. The second set of host machines is for hosting L3 gateways for the second logical router. The L3 gateways connect the tenant logical network to at least one external network.