Managers

EXCLUSIVE: Frogmore revises Fund III close to £400m

The investment manager which initially closed on £377 million at the end of June got permission from its investors to receive more commitments taking the fund total to £400 million.

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Frogmore, the London-based real estate investment manager, has held a £400 million (€574 million; $623 million) final close on its third fund – Frogmore Real Estate Partners III – after allowing more investors into the fund.

The firm had already beaten its original target of £350 million after holding a close on £377 million for the fund back in June. But, after receiving the go-ahead from its investors Frogmore took in another capital commitment and £7.5 million in co-investment capital.

“We are delighted to have revised our final close number to £400 million which was due to a UK local authority pension fund making a commitment and excitingly a new investor making an additional commitment by way of a co-investment into one of the projects,” said Stuart Jenkins, director of fund management at Frogmore.

Frogmore was able to attract capital from five US and two Canadian institutions, one European and one UK institution, four UK wealth managers and for the first time raised capital from, Asia, with two Singaporean investors.

The firm hired Triton Pacific Capital as its exclusive placement agent in North America, and FirstPoint Equity to assist with European fundraising efforts. The firm engaged Odyssey Partners to aide its fundraising in Asia.

The investment strategy of Fund III will be in line with Frogmore’s previous two funds focusing on value-add properties across a range of sectors, targeting IRRs in the mid-to-high teens and an equity multiple of 1.8x.

The firm has already made a string of investments using Fund III capital, the most recent being a £215 million investment in a London residential complex called Notting Hill Gate Estate, from The Pears Group in a joint venture with LaSalle Investment Management.

Frogmore purchased the freehold estate, which totals approximately 171,000 square feet of retail, office and residential accommodation; arranged across four blocks. The estate, which is situated in the Royal Borough of Kensington and Chelsea, sits prominently on both the north and the south side of Notting Hill Gate.

The firm has also used Fund III capital to acquire: West One Retail Park, Eccles, Manchester; 2 Millharbour, London Docklands, and an office led refurbishment project in Holborn, London.