Hines’ European fund makes first UK deal

The US investor is buying an office above London’s busy Fenchurch Street station as it reaches the half way investment mark for a European fund.

Hines, the giant US property investor, has made the first UK purchase for its European Value Added Fund, it revealed today.

It has bought a five-story office building, Gartmore House, on Fenchurch Place, London, from private Middle Eastern investors in a £52m (€76 million; $98 million) deal, reflecting a yield of 6 percent.

The acquisition is the fifth for the fund, but the first in the UK since it was launched in April 2005.

Hines UK director Andrew Reynolds said: “Gartmore House is located in a thriving business district within the City of London where demand for quality office space is increasing.”

“The Fund has now successfully placed almost half of its capital commitments within one year” said Lars Huber, fund manager and Hines Europe director.

Hines UK also announced that it has hired Anthony Havelock, formerly of ING Real Estate, who will be responsible for acquisitions in the UK for the Hines European Value Added and Core Funds.

Hines set up its closed end fund to acquire existing Western European value added properties.

It was set up with €300 million ($382 million) equity focusing primarily on office property but also branching out into residential and retail value-added investments in Western Europe.

It has bought two assets in Madrid and Paris.