UBS Global launches UK office fund, makes purchase with Euro core fund

UBS Global Asset Management has restructured an established fund and made an acquisition with another. 

The firm has formed a value-added UK fund, the UBS Central London Office Value Added Fund (UBS-CLOVA), formerly known as the UBS South East Recovery Fund (UBS-SERF). However, the fund has been restructured to focus on the Central London office market. 

UBS-CLOVA is open to new investment with a target capital raise of £100 million (€113, $159) by the final close on 30 June 2012. It has a fixed life with a maturity date in December 2015. This date has been designed to match the forecast recovery in Central London and to maximise returns to investors. According to the firm, the fund is targeting a return of 10 percent per annum.

 “Our existing investors have supported the new strategy for the Fund and we look forward to deploying new equity into the market over the next 12 months,” said Sam Sananes, portfolio manager for UBS-CLOVA in a statement.

In contrast to new funds, the firm has an established portfolio of six Central London office properties. Consequently, investors will gain immediate access to the market through an identifiable portfolio of assets in which investment has already been made.

UBS-CLOVA will continue with its value-added style and new acquisitions will focus on multi-leased assets with asset management potential and refurbishment opportunities. The vehicle recently acquired Atlas House on Cheapside in EC2. It expects to complete its next acquisition this quarter. 

Separately, UBS Global Asset Management's European core real estate fund, UBS Euro Core, has acquired a logistics property in Vantaa, Finland. UBS Euro Core will acquire two separate co-located properties from YIT Construction, comprising a total of roughly 90,000 square feet of warehouse and office space upon completion. The total value of the transaction is €40 million. UBS Euro Core now has €510 million in property assets under management.

In a statement, Mark Gifford, portfolio manager for UBS-Euro Core, said: “This property represents the funds first purchase after raising new client equity earlier this year and reflects our focused efforts to diversify the funds property portfolio. This particular asset offers modern flexible, environmentally sustainable warehousing in a European sub-market we forecast to be a strong performer over the next few years.”

UBS Euro Core is seeking to increase its exposure to the logistics sector and to new geographical markets. The assets are situated in an established location for light industrial and warehousing within the Helsinki Metropolitan Area, near the Helsinki-Vantaa airport. The first phase, comprising 35,100 square feet, is fully-leased to the Tecalemit Group, Haugen-Gruppen and Nordqvist. The second phase, comprising 54,000 square feet, is due for completion in spring 2012 and the main tenant will be Oy Lining.