Henderson Global Investors has acquired a five-property portfolio in London, known as the Leadenhall Triangle, for £190 million (€215.6 million; $307.2 million). The London-based investment management firm purchased the assets on behalf of its Central London Office Fund, its Central London Office Fund II and Alberta Investment Management Corporation, which manages roughly C$71 billion in assets on behalf of the province of Alberta’s public pension plans, several endowments and the provincial sovereign wealth fund.
The portfolio, which had been owned by clients of London-based property fund manager Investream, was acquired by Henderson out of administration. According to Nick Deacon, fund manager at Henderson, PricewaterhouseCoopers (PwC) was appointed administrator of the properties in November 2010 after Investream defaulted on a roughly £153 million loan secured by the properties that matured in April 2010. PwC was appointed by Hatfield Philips International, the special servicer of the loan.
The portfolio formally was placed on the market on 8 April, when PwC and strategic property advisors Cooke and Powell issued an information memorandum to more than 60 interested parties. Following inspections of the properties, first round bids were called for and were received on 6 May, resulting in a large number of offers.
Upon subsequent analysis of the initial offers, PwC determined that concluding a contract with Henderson represented the best outcome for all stakeholders. In fact, Deacon said Henderson submitted a pre-emptive bid early in the process, which led to PwC entering into an arrangement with the investment firm. An unconditional contract was entered into between the administrators and Henderson at the sale price on 13 May, with completion scheduled for 16 June.
“The assets are well-located from a market perspective,” said Deacon. “Investream was in talks with Deutche Bank about a bigger redevelopment for the properties, but that fell away. We see more value in actively managing these assets.” He added that redevelopment “certainly is a long-term possibility, but it is not a view we see in this cycle.”
Located near Lloyd’s of London and 30 St Mary Axe, also known as the Gherkin, the properties include 49 Leadenhall, known as the Markel Building; 52-56 Leadenhall Street; 100 Fenchurch Street; 109-114 Fenchurch Street; and 9-13 Fenchurch Buildings. The first three of those properties total 454,560 square feet and were acquired by Investream at various times between December 2000 and March 2006, according to data from Real Capital Analytics.