Moorfield Group, the London-based investment manager, is among a number of private equity real estate firms to have invested in the current funding round of the International Property Securities Exchange, the first regulated securities exchange dedicated to the trading of securities in individual commercial real estate properties.
Confidence in the commercial real estate market was shaken in the aftermath of last June’s European Union referendum, which saw some of the UK’s largest property vehicles suspend investors’ redemptions.
The Financial Conduct Authority has undertaken a review of the issue to avoid similar occurrences in the future, but IPSX believes its platform will provide transparency and a new avenue of liquidity for the owners of commercial real estate assets by enabling them to list assets and trade shares in the same way as equities and other listed securities.
The IPSX Group, the company which runs the exchange, said the platform, which is still subject to regulatory approval by the FCA, will offer a regulated, transparent and liquid market which it believed would allow it to become the fourth mainstream asset class alongside cash equivalents, equities and bonds.
The commitment from Moorfield, precise details of which have not been disclosed, follows prior investments from a number of well-known names in the commercial real estate industry, including London-based firms British Land, M7 as well as four partners from Tritax Group.
Moorfield chief executive officer Marc Gilbard said the creation of a flexible market for the realization, investment and trading of a range of real estate assets was “long overdue.”
“In broadening the access to an asset class which is only currently available to institutional, professional or high net worth investors, IPSX will provide significant benefits to many other real estate investors,” said Gilbard. “Of course, it will also deliver some much-needed real time valuation evidence,” he added.
But Anthony Gahan, chairman of IPSX, said Moorfield’s commitment was a “further demonstration” of the industry’s appetite for innovation in commercial real estate investment.
“As we move towards our launch, our dialogue with the wider real estate industry and associated ecosystem continues to discover strong demand for a new class of commercial real estate securities with a regulated trading platform that will provide greater transparency, liquidity and attractive yields to investors,” said Gahan.
IPSX said the platform will be launched at a later, but as yet unconfirmed, date.