Ares picks up Piccadilly Place from Carlyle for £117m

Ares Management has acquired the UK office and retail property Piccadilly Place for around £117 million ($164.9 million; €144.7 million) from The Carlyle Group.  

The 300,000 square foot site consists of two adjacent buildings, Three and Four Piccadilly Place, and a three-story car park. 

The office space, located in Manchester, is 95 percent let to tenants including Barclays, Orega, Arup and Egencia. Retail tenants include Starbucks, Pita Pit and Anytime Fitness.  

The Los Angeles-based investment management firm did not disclose which fund the asset was acquired through.   

Ares said it intends to add value to the property by attracting more tenants and improving the management structure. Although the firm did not disclose which fund the asset was acquired from, Ares’ most recent value-add vehicle was the Ares European Property Enhancement Partners II (AEPEP II) fund.

Carlyle bought the complex from Argent in 2007 for around £90 million ($164.9 million; €111.4 million) and funded the development of Four Piccadilly Place.

Wilson Lamont, partner at Ares, said: “The market fundamentals in Manchester look increasingly attractive, and we believe Piccadilly Place, which is ideally located next to a major transportation hub and in a high traffic area of the city, is set to benefit from this strategically important and improving location.”

Ares held a first close on $366 million for AEPEP II in September last year, after seven months in the market, with a desired target of $600 million.

Ares was advised on the transaction by Property Alliance Group and King Street Commercial while Bilfinger GVA and CBRE acted for Carlyle.

In February, Ares acquired two French retail outlet centers, in the regional cities of Troyes and Roubaix, for around €200 million and established a €500 million joint venture for Iberian retail with pan-European real estate investment management company Redevco last September.  

Ares had approximately $94 billion of assets under management as of December 31, 2015, of which $10.3 billion was in real estate.