Rockspring attracts £150m to UK core-plus fund

The London-based firm has now progressed to a third close on UK Value 2 and has struck two more deals for the program.

Rockspring Property Investment Managers, the pan-European real estate manager, has taken its fundraising tally to £150 million (€188 million; $248 million) for its UK core-plus offering. The total number of investors in the fund is now five, with those limited partners coming from the UK, Europe and Australia, according to Rockspring

In announcing a third close, Rockspring noted that it still is targeting a total equity haul of £300 million and therefore is now halfway towards it target. A final close is set before the end of the year.

At the same time, Rockspring has struck two acquisitions. The first is Bromley shopping center in Leeds and the second is Guildhall, an office and retail investment in Glasgow. Those two acquisitions, for a total of £47.5 million, come in the wake of buying the Maskew Retail Park in Peterborough and takes aggregate deal volume to £84.5 million.

Richard Bains, partner at Rockspring and manager of the fund, said the firm had closed one deal per month since launching the vehicle. During PERE’s UK roundtable, published in June, he explained how distressed real estate will offer attractive opportunities in which the new fund can invest.

“When buying an unloved asset, the price that you are paying may not be cheap, but the opportunities within those assets for asset management specialists like us are massive,” Bains said. “We have an improving economy, so turning these assets round is a whole lot easier now than it has been over the past five years. Core-plus values have come in massively over the past six to nine months, so we will not be able to make money for UK Value II just out of yield compression. It will be all about the value we can create and, in an improving economy and occupational market, you have to back yourself to do that. There are opportunities all over the UK in all sectors.”

Rockspring, which manages £2.5 billion of UK property, has divested roughly one-third of its first closed-ended UK Value Fund. That seven-year vehicle closed in June 2010 on £336 million of equity from 12 investors