March 2010
09/03/2010Metric Property announce initial public offering
Metric Property has announced that it will hold an initial public offering (IPO) as it prepares to be floated on the London Stock Exchange (LSE).
The newly established specialist retail property investment firm intends to capitalise on re-pricing and refinancing pressures in order to build up a portfolio of real estate assets and is already in discussions regarding possible retail property acquisitions
Managed by a specialist team comprising three former directors of British Land, Metric has already received an initial £6 million investment from its directors and plans to raise £150 million through its IPO and to commence trading on the LSE as of March 19th.
Chief executive Andrew Jones remarked: "We believe that the extensive re-pricing of the real estate market and the adoption of our occupier-led approach will present a significant opportunity for Metric to create value for shareholders through our active approach to asset management and through the leveraging of our strong retailer, property investor and banking relationships."
Mr Jones' former employer British Land boats a retail property portfolio valued at £5.25 billion for the three months to December 2009.
08/03/2010Council could invest in Manchester Spinningfields property development
Manchester City Council is considering buying a stake in a planned property development in the city's Spinningfields districts in order to ensure it goes ahead.
Allied London intends to erect 580,000 square feet of office and retail real estate on sites at One and Two Hardman Street, and Two and Three Hardman Boulevard, but its plans have been held up by a lack of access to bank lending.
It has therefore asked the council to consider acquiring the freehold interests in these two sites and then lease them to Allied London, which the developer claims would enable the property development to be ready by 2015.
A report to the council's executive stated that taking such action now would "enable the momentum of Spinningfields and the pace of change in the city centre to be maintained".
It added: "These buildings would continue to enhance the city centre commercial property offer by providing buildings that cannot be provided elsewhere."
Latest figures from the Royal Institution of Chartered Surveyors indicate that demand for office space fell slightly in the north-west during the final quarter of last year, but there was an increase in demand for retail property in the region.
05/03/2010FSA chief calls for commercial property lending crackdown
The chairman of the Financial Services Authority (FSA) has advocated restricting bank lending to the commercial property sector and diverting credit into other areas instead.
Lord Adair Turner told the House of Commons Treasury Committee that 80 per cent of lending is now either to the residential or commercial real estate sectors, whereas other areas of the economy, such as manufacturing, deposit roughly as much as they borrow.
While backing lending for new developments, he criticised firms' usage of credit to leverage real estate assets in order to benefit from tax breaks and suggested Britain follow the lead of states like Canada and Hong Kong in placing limits on this type of lending.
Citing the example of the Halifax Bank of Scotland (HBOS) group, Lord Turner remarked: "HBOS was not involved in fancy proprietary trading. It was a bank involved in a classic problem of over-exuberant banking to commercial real estate."
Latest figures from the Bank of England indicate that real estate lending showed only a minimal year-on-year decline during the final quarter of 2009, compared to a £4.3 billion reduction in all corporate lending over the same period.
03/03/2010AEGON launches small property investment vehicle
AEGON Asset Management has announced the launch of a new fund designed to invest in small real estate assets on behalf of pension fund investors.
Its Active Value Property Fund will concentrate on investment in retail, industrial and office real estate valued at between £3 million and £10 million, although it could also make leisure, medical, student and residential property acquisitions as well.
The fund will have virtually no gearing and an initial projected yield of seven per cent and is intended to outperform the Investment Property Databank's (IPD) all balanced funds index by 0.5 per cent on a rolling three-year basis.
Its lead manager David Wise remarked: "We believe there is a gap in the market for our fund to gain a competitive edge by buying properties in the £3-10 million size range, that are too big for private buyers but too small for most institutional investors."
The IPD's all balanced fund index showed a 7.9 per cent total return over the final quarter of last year, but also displayed a total return of -1.8 per cent for 2009 as a whole.
02/03/2010New retail property co-investment venture established
NewRiver Retail has entered a joint venture with Morgan Stanley Real Estate Investing (MSREI) to undertake investment in retail property assets.
The venture, entitled NewRiver Retail Investments, will have over £250 million to spend on purchasing retail premises, with an investment period of two years and an overall life-span of at least five years.
It has already completed its first acquisition, obtaining a real estate portfolio of nine properties comprising over 400,000 square feet of retail space from UBS Triton Property Fund for £49 million.
NewRiver's David Lockhart commented: "Having MSREI on board not only endorses our focused sector specific business strategy and investment case, but also validates our view that our opportunistic approach to acquisition and active asset management is the best route to value generation at this point of the commercial property and economic cycle."
Latest figures from Investment Property Databank indicate that on average UK retail premises showed capital growth of one per cent last month.
