David Boyle, the former chief investment officer at Morgan Stanley’s Alternative Investment Partners Real Estate, and Brad Beanblossom, one of Sam Zell’s protégés at Equity International (EI), have launched a value-add real estate business with backing from UK private equity real estate firm Delancey.
The pair left their roles at Morgan Stanley and EI last summer to launch Chicago and London-based real estate investment advisory firm NW1 Partners, which will focus on value-add investments in the US, the UK and continental Europe. Although Boyle and Beanblossom have not worked for the same firm, they had a relationship having worked on a number of joint ventures together.
Boyle, NW1’s managing partner, and Beanblossom, the firm’s partner, said the new business will pursue “high conviction” investment opportunities through joint ventures in partnership with local operating partners and selected co-investments with small fund managers.
The business will invest across all property types, with a focus on “small cap, consumer-driven strategies” found in sectors such as urban retail, last-mile logistics, parking and self-storage. The partners said they felt this approach would not only help them acquire assets in fragmented, less competitive markets, but would also provide opportunities for a portfolio “roll-up” and institutional exit.
For the moment, the new business is content with joint venture deals but has not ruled out setting up a real estate fund in the future.
“We’ve devoted a significant amount of time meeting with investors and listening to their needs and objectives,” said Boyle. “Brad and I heard a clear, consistent message from investors that they would like to access small cap investments with emerging local operating partner talent that they have difficulty accessing on their own, but play an important role in their portfolio construction.”
“At the same time, they want a clear, aligned fee structure with transparent, real-time access to information on the underlying investments,” Boyle added.
Delancey founder and chief executive officer Jamie Ritblat and managing director Paul Goswell have joined NW1’s board of directors and sit on its investment committee, though in non-executive roles.
“We are very fortunate to have the strategic support of Jamie, Paul and the Delancey management team,” added Boyle. “I have enjoyed the good fortune of working closely with Delancey over the years, including investing together as partners. I view this as the natural continuation of our strong relationship.”
“NW1 Partners was borne out of a clear market need and is led by two highly astute individuals in real estate,” said Ritblat. “They have a unique strategy and approach to the market, which resonates well with investors as the private equity real estate industry continues to evolve.”
Prior to forming NW1, Boyle was managing director and chief investment officer of the AIP Real Estate team at Morgan Stanley, after joining in 2008, where he was responsible for investment strategy across Europe, Asia and the Americas. Before that role, Boyle held senior positions at Brookfield Asset Management, APG Investments and Deutsche Bank.
Beanblossom spent 15 years with Sam Zell’s Equity International until his departure last summer. In his most recent role at EI, Beanblossom oversaw the firm’s investments team as senior vice-president and also served as a member of EI’s investment committee. Beanblossom began his real estate career in 1997 at Arnold Palmer Golf where he was responsible for originating and underwriting the acquisition of golf courses.
“We have already formed our first programmatic joint venture,” said Beanblossom. “It is based on an urban retail strategy which has been established with a talented emerging manager in Washington, DC, to assemble a portfolio of assets in the growing millennial influenced sub-markets,” Beanblossom added.”
It is understood the firm is also looking at last mile logistics assets in London and has been identifying potential assets in Berlin.