The Jersey office of Walkers, a leading international financial law firm, has advised on the establishment and launch of the UK Property Income Fund (UK PIF) on behalf of Legal & General Property.
The fund, which since its launch in late 2010 has secured commitments totaling £300 million from 14 major international institutional investors, has raised £52 million of equity during the last six months alone and has a total investment capacity (allowing for gearing) of around £475 million.
Walkers acted as Jersey counsel on the fund’s establishment, launch and fund raising as well as on the acquisition and financing of six real estate investments during the last 18 months using Jersey domiciled holding structures. The Walkers team is led by Partner Jonathan Heaney.
The closed ended fund, which has attracted investors based in the Middle East, Denmark, UK, France, Finland, Switzerland and Japan, adopts an innovative approach to accommodating a wide range of investor risk appetites, by allowing investors to choose their preferred level of gearing of between 0% and 50% Loan to Value (LTV).
The fund aims to provide investors with returns of 15% (geared) and 10% (ungeared) through careful stock selection of large lot size assets which will be positioned to capitalise on the economic recovery in the UK based on a core/core-plus risk strategy.
The final split of investors demonstrates demand for both geared and ungeared positions demonstrating for some a confidence in applying debt at the lower end of the risk spectrum, whilst others favour a pure property exposure. The internationally dominated investor base clearly signifies the global appeal of UK commercial property.
Jonathan Heaney, Partner, Walkers Jersey, said: “Our expertise in fund structuring, acquisition finance, corporate, real estate and trusts, combined with the multiple attractions of Jersey as a jurisdiction for Legal & General Property’s latest fund, put us in pole position to advise on this deal.
“We have delivered on the ground expertise against the background of a Jersey legal framework which enables trusts to be established quickly, efficiently and in this case in a time zone which is appealing to our clients and their investors. “We’re operating in a turbulent macro financial market but it's encouraging to see that there are still attractive opportunities for investment, via funds of this kind.”
Charlie Walker, Director of Business Development – Legal & General Property and Fund Manager of the UK Property Income Fund, added: “Against challenging market conditions, in which so many have struggled to raise funds, the significant capital raised from this new base of major global institutional investors not only reflects the attractiveness of this innovative fund structure, but obvious appeal of the fund strategy.
“With a decreasing number of institutional investors competing in the larger lot size segment of the market and a growing supply of chunky, income-producing assets coming to the market, we feel that the UK PIF is strongly positioned to take advantage of short term mis-pricing and a lack of liquidity beginning to surface once again.”
Walkers has also recently advised on three acquisitions for the fund which completed in December 2011. These included the acquisition of a shopping centre in Chelmsford, Essex and the purchase of 1 City Place, Gatwick part of an office complex situated at Gatwick Airport in Crawley, West Sussex.
Walkers is a leading International Financial Centre law firm and widely recognised as a leader in the offshore legal industry. It has offices in the British Virgin Islands, the Cayman Islands, Delaware, Dubai, Dublin, Hong Kong, Jersey, London and Singapore, and the Walkers Group provides legal services to FORTUNE 100 and FTSE 100 global corporations and financial institutions, capital markets participants, investment fund managers and middle market companies.
Walkers’ expertise has been validated by numerous awards including “Offshore Law Firm of the Year" by Alpha Magazine, The Lawyer, PLC Which Lawyer?, International Financial Law Review – Asia and Asian Legal Business. Walkers has also been honoured as the PLC Which Lawyer? Yearbook Leading Cayman Islands Law Firm, Who's Who Legal Law Firm of the Year: Cayman Islands and has shared honours for “Offshore Legal Team of the Year” by the Society of Trust and Estate Practitioners (STEP). Many of Walkers’ attorneys have also been recognised by the industry and their peers.
For more information on the Walkers group, visit us on the web at www.walkersglobal.com or contact us by e-mail at email@example.com.
To contact Walkers by phone, call our Jersey office at +44(0) 1534 700 700.
For additional information please contact:
Weber Shandwick Financial
14 Gray’s Inn Road
T: +44 (0)20 7067 0705
14 Gray’s Inn Road
London, WC1X 8WS
T: +44 (0) 020 7067 0328