Apollo, Ivanhoé Cambridge forge £100m-plus UK resi venture

New York's Apollo Global Real Estate Management has struck up a venture with Canada’s Ivanhoé Cambridge and prime central London residential property company Residential Land.

Apollo Global Real Estate Management, the New york-based firm, has struck up a venture with Canada’s Ivanhoé Cambridge and prime central London residential property company Residential Land, to buy rental buildings in London.

Revealing details today, the trio said Ivanhoé Cambridge would be the majority partner in the venture.

The partnership’s debut investments are four multi-let residential buildings, totaling 207 units, located in the prime London districts of South Kensington, Lancaster Gate, Bayswater and Marylebone.

The venture will seek to purchase prime residential property in London, with an initial investment of over £100 million (€120 million; $157 million) and substantial additional committed capital to take advantage of the sustained demand for high-quality privately rented accommodations, they said.

 “We are delighted that Ivanhoé Cambridge has selected us as its partner in this new program and believe this partnership represents the further development of our business with respect to creating a select number of customised accounts,” said Roger Orf, head of Apollo Global Real Estate Management in Europe.

Apollo also will invest directly in the partnership. Orf added:  “We believe our seasoned executives are well-positioned to capitalise on opportunities in this fragmented market as we actively expand Apollo’s real estate platform into new markets including the UK. We also believe this type of partnership allows us to capitalise on the firm’s diverse investment skills, while prudently managing risk.”

Ivanhoé Cambridge’s investment strategy targets multi-residential assets in key cities. “Following our recent purchases in Montreal in Canada and in San José in the US, London is a natural top choice,” said Daniel Fournier, chairman of the board and chief executive officer of Ivanhoé Cambridge.

Residential Land has been appointed as strategic asset manager and will also be sourcing and managing acquisitions on behalf of the partnership. “Central London’s residential market presents some excellent business opportunities, and this partnership puts us in a position to seize them,” said Bruce Ritchie, founder of the company.

Macquarie Capital Advisors was the sole advisor on the transaction and acted as the equity arranger to Residential Land .