UK and European industrial property company Hansteen Holdings has raised a real estate fund focused on investing in the UK with £90 million of equity ($151 million; €106.1 million).
The Hansteen UK Industrial Property Unit Trust, which closed on the equity last month, will target “high income generation” investments and “growth in net assets”. It is planning to invest in up to £180 million of real estate by employing a gearing ratio of 50 percent.
In an announcement by the London-based firm today, Morgan Jones, chief executive officer of Hansteen, said the fund would bring the firm’s overall spending power to more than £500 million. He said: “In addition to the return on our investment and our management fee we have the opportunity to receive a disproportionate share of any outperformance in the fund we generate.”
According to the announcement, £30 million was injected into the fund by the firm while the remaining equity for the vehicle was raised from five institutional investors.
The fund is to run for six years and is targeting annual returns, after fees and expenses of between 12 and 15 percent. Hansteen will receive an asset management fee and a performance fee based on a fee equal to 20 percent of returns above a hurdle of 10 percent a year rising to 30 percent above a hurdle of 15 percent a year.
Mark Ovens, fund manager at Hansteen, said: “The next twenty-four months or so will present compelling buying opportunities; a number of which we are already looking at. We believe we will be able to acquire good quality multi-let property with sound fundamentals at very attractive prices and generate real growth through applying our value focussed approach to asset management.”