The continuing strength of the UK regional property market has led one third-party investor to start ploughing its own funds into the sector.
Harwood Real Estate, the property arm of Harwood Capital Management, has bought a £75m mixed-use portfolio of 22 assets from Aprirose in an off-market deal. The price reflects an 8% yield.
Founded by City fund manager Christopher Mills in 2011, Harwood Real Estate has previously only co-invested in deals or bought on behalf of third parties, largely from North America and the Middle East.
Its parent company has earmarked a further £50m for the firm to spend by the end of the year and it is now exploring options to raise as much as £100m.
Director Jonathan Whittingham said: “We are continuing to see strong returns on good regional stock and are delighted to have secured this portfolio as a cornerstone to our real estate holdings.
“Having delivered strong performance for our third-party investors over the past 24 months, it was deemed the right time to deploy our own capital to benefit more directly. We will of course continue to co-invest with our strategic funding partners to allow us to access other larger-scale opportunities.”
The latest purchase comprises around 800,000 sq ft of buildings which generate £6.3m pa.
Assets include a 62,500 sq ft Wilkinson’s in Ilford, north-east London, and contractor Carillion’s 28,250 sq ft Lowry House offices in Manchester.
The deal increases Harwood’s UK assets under management to £225m. The firm has €1bn (£795m) of European assets under management.
BCM advised Aprirose; Harwood was unrepresented.
joanna.bourke@estatesgazette.com
