Two years ago, Marc Mogull made waves in the European private equity real estate industry when he announced his departure from Doughty Hanson, where he had founded the UK private equity firm's real estate arm. These days, Mogull is looking to make waves of a different sort, by implementing his middle market investment strategy with a firm of his own.
As founder and managing partner of Benson Elliot, a London-based private equity real estate firm, Mogull is currently raising a €350 million fund, Benson Elliot Real Estate Partners II. Though the pan-European vehicle has already held a first close on €264 million, sources close to the firm note that investor demand has exceeded €1 billion.
No doubt investors were attracted to Mogull's longevity in the European property markets, his track record at Doughty Hanson and his granular approach to real estate investment. As he puts it, “I've always taken a bottom-up approach to this business. I'm not big on broad, sweeping strategies.”
Nevertheless, Benson Elliot's strategy does call for deals of a particular size, up to €200 to €250 million. “That is a space I've always felt comfortable with,” Mogull says. “Deals driven more by fundamentals than by financing.”
To help him source and executive those deals, Mogull recently hired Trish Geery, former managing director and head of global real estate for the Dubai Investment Group. Geery, who also spent 10 years with Goldman Sachs, much of it in Europe, will be a partner at the firm. According to Mogull, Benson Elliot, which currently has seven professionals, will have at least 10 by the end of the year.
Though Benson Elliot, as one of just a handful of independent pan-European private equity real estate funds, could easily be categorized as an opportunity fund, Mogull takes a different viewpoint, one that not only reflects his newfound independence but also neatly summarizes his investment philosophy.
“I don't view myself as being in the opportunity fund game,” he says, adding that his firm's approach, while focusing on hard asset investing, is much more akin to a hedge fund than an opportunity fund. “Our investors understand that one of the most important things we should be doing for them is to assess and price risk. That's inconsistent with the prevailing model of a single return hurdle (typically 20 percent) and one-size-fits-all capital. We've got the flexibility to look at deals with a broader range of risk profiles and, consequently, a broader range of forecast returns. I don't feel as constrained as under the old model.”
Carlyle hires MD for Nordic region
The Carlyle Group has appointed Thomas Lindström as managing director and head for the Nordic countries. Based in Stockholm, he will help Carlyle build out an investment and asset management team in the region. Lindström has 14 years experience in the local property markets, previously working at GE Real Estate Nordic, where he was in charge of business development and responsible for acquisitions. Prior to that, he was responsible for GE's sales activity in the Nordic countries, in addition to managing the firm's joint ventures and loan activity. He was also a senior member of the DTZ Sweden investment team. Carlyle's second European fund closed on €760 million in September 2005 and is now around 50 percent invested.
SGAM announces new appointments
Societe Generale Asset Management has revamped its personnel roster to help expand its open-ended real estate fund business in France—as well as aid in the firm's push into international markets. Jean-Christophe Ginet, previously the firm's managing director of strategy and development, is becoming the global head of SGAM AI Real Estate Investment Managers. Meanwhile, Aymeric Thibord has been named managing director of acquisitions, Jerome Delaunay has been named managing director of real estate asset management and Anthony Guérard has been named managing director of product development. Jocelyne Grossin-Petit has been confirmed as deputy chief executive of closed fund subsidiary GESTINVIM.
Plummer to head new Oxford-CBRE multi-manager strategy
Jeremy Plummer has been appointed as the managing director of a new multi-manger platform and European fund of funds acquired by the London-based arm of CBRE Investors. The investment management affiliate of Richard Ellis acquired Oxford Property Consultants, where Plummer was a managing director; the combined business will be known as CBRE Investors Global Multi Managers. Plummer will head up a team that will include Rupert Wingfield, who currently heads up CBRE's multimanager strategy. Andrew Baum has been appointed chief strategist. Once the business lines are combined, the new multi-manager group will have initial mandates of £750 million (€ $1.4 billion) and will launch a series of fund of funds targeting Europe.
Clifford Chance expands into Romania
Nadia and Daniel Badea, both of Romanian law firm Badea & Asociatii, are working with London-based law firm Clifford Chance to open a new office in Bucharest, marking Clifford Chance's foray into Romania. Nadia Badea focuses on corporate, private equity and real estate, while Daniel Badea specializes in banking, finance, capital markets transactions and infrastructure projects. Nick Fletcher, managing partner of Clifford Chance's Warsaw office, will be a partner in the new branch.
Palamon sells theme parks
London-based buyout shop Palamon Capital Partners has sold six of the seven amusement parks in its StarParks Group portfolio company. Details of the transactions were not disclosed. Compagnie des Alpes, a European leisure park and ski resort operator, acquired five of the parks, located in France, Belgium and the Netherlands. Walibi Lorraine, located near Metz, France, was sold to a private entrepreneur. StarParks will retain ownership of the remaining park, Movie Park Germany. Palamon acquired the European division of Six Flags, a US-based theme park operator, for €155 million ($199 million) in April 2004.
GI Partners buys into UK pubs
California- and London-based private equity firm GI Partners has acquired 290 managed pubs from Punch Taverns. GI Partners paid £571 million (€831 million; $1.1 billion) for the Spirit Group pubs portfolio, its largest deal in Europe to date. The portfolio includes 136 pubs in the south of England and Wales, 133 in the north of England and 21 in Scotland. Punch Taverns acquired Spirit Group in December 2005 from Texas Pacific Group, Blackstone, CVC Capital Partners and Merrill Lynch Private Equity in a £2.7-billion transaction. In May, GI Partners acquired 21 oriental pub restaurants from Noble House Leisure and Oriental Pub Company.
Starwood sells champagne business
Greenwich, Connecticut-based Starwood Capital Group has agreed to sell French champagne maker Taittinger to Credit Agricole du Nord-Est for approximately €660 million ($840 million), including debt. French bank Credit Agricole du Nord-Est has backed Taittinger's current management, led by Pierre-Emmanuel Taittinger, grandson of founder Pierre Taittinger. Starwood acquired Groupe Taittinger, owner of Taittinger CCVC, the world's sixth largest champagne producer, last July in the €1.2-billon acquisition of Société du Louvre, which included a large hotel portfolio. Taittinger CCVC controls approximately 700 acres in France as well as two vineyards in California.
Macquarie buys Warsaw offices, French logistics
Bermuda-based Macquarie Global Property Advisors (MGPA), the private equity real estate arm of the Australian bank, has announced a joint venture to develop French warehousing space as well as an investment in a Warsaw office building. In the French logistics JV, Macquarie will team up with Parisian developer Concerto Développement to build a €250-million ($315 million) portfolio of logistics parks throughout France. The project will initially develop two predetermined sites, near Lille and Valence, with a combined value of €90 million. Further East, Macquarie announced the acquisition of a Warsaw office block in a joint venture with London property company London & Regional Properties. The building is a 40-story office tower with 60,000 square meters of available space and 492 parking spots.