Northcliffe Asset Management has been launched to invest in the rapidly growing global market for real estate sale-leaseback investments by four previous senior executives, including Gordon F. DuGan former Chief Executive, of the leading investment manager in the net lease sector - New York based W. P. Carey & Co. LLC.
DuGan is joined by three other former W. P. Carey executives, Benjamin P. Harris, former Head of U.S. Investments, Alistair Calvert, former head of the London office and Michael Heal, from the Investment department of the London office.
Gordon DuGan, Executive Chairman and Managing Partner of Northcliffe Asset Management and former CEO of W. P. Carey said: "We intend to build Northcliffe into the best-in-class global investment manager for sale-leasebacks and net leased investments. We expect to benefit from extraordinary opportunities available in the current economic climate. Companies are climbing out of a period of turmoil, with liquidity and capitalization their primary concerns. They are looking at a variety of financing alternatives, such as sale-leasebacks.
"On the fund raising side of the equation, we are also seeing unprecedented interest from investors as virtually no other real estate strategy offers the risk adjusted cash returns of sale-leasebacks in this environment. The European team already manages a successful net lease portfolio and is actively investing, the US team will begin shortly."
Institutional and retail investors typically gain access to the stable long-term cash flows salel-easebacks generate, through investing in large and diversified funds managed by an investment manager.
Gordon F. DuGan is a pioneer in sale-leaseback investments, with over 20 years in the sector. He was appointed president of W. P. Carey in 1999, Co-CEO in 2002 and CEO in 2005, overseeing the most dynamic period of growth in the company's history. During this period, the firm's assets under management rose from US $2.5 billion to around US $10 billion in 2010, becoming the largest company in the investment sector worldwide.
DuGan resigned as CEO of W. P. Carey in July this year. DuGan worked closely with W. P. Carey, Managing Director and Head of U.S. Investments, Ben Harris for more than 12 years, including most recently on the US $225 million sale-leaseback of the iconic New York Times Building in New York to its newspaper tenant in 2009. Harris resigned from W. P. Carey in September and joins Northcliffe Asset Management as a Partner in New York.
ThreadGreen Partners LLP, founded in 2007 by Alistair Calvert, former head of the European office of W. P. Carey, and Michael Heal, will become the European operations of Northcliffe. They have invested in excess of US $1 billion in commercial property and have one of the most experienced sale-leaseback platforms in Europe. DuGan, Harris, Calvert and Heal have all worked closely together at W. P. Carey.
Alistair Calvert, Managing Partner of Northcliffe Asset Management in Europe concluded: "The opportunities in sale-leaseback transactions have never been greater with the spread between the rental yield on these investments and financing costs at historic highs. Constrained capital markets and the over-leveraged corporate sector have resulted in a huge supply of transactions.
"The undeveloped nature of the European market - which at US $4 trillion has twice the level of owner occupied commercial property of the US - suggests that this deal supply will continue. I think we have the most successful and experienced senior management team in the sector and I expect Northcliffe to rapidly become the first port of call for companies and investors wishing to tap into this increasingly relevant financing product."
Source: Bellier Financial