Hansteen (AIM:HSTN), the investor in UK and Continental European industrial real estate, announces the launch of the Hansteen UK Industrial Property Unit Trust ("HIPUT" or "the Fund"). The Fund will be seeking to invest up to £180 million (approx. 212.5 mln.) in UK industrial property.
The Fund has been launched with £90 million of equity of which £30 million is provided by Hansteen and the remainder from five institutional investors. The Fund will be prudently geared to a maximum of 50% once the equity has been invested giving a total fund size of £180 million.
Morgan Jones, Joint Chief Executive of Hansteen said: "This Fund, coupled with £200 million raised recently gives us over £500 million of buying power in a market which is presenting some unprecedented opportunities. In addition to the return on our investment and our management fee we have the opportunity to receive a disproportionate share of any outperformance in the Fund we generate."
Ian Watson, Joint Chief Executive of Hansteen added: "We had identified the opportunity to gain further exposure to the industrial property cycle through the formation of limited life funds with third party investors, at the time of our recent fundraising, which we successfully closed in July. We are delighted this has now come to fruition."
HIPUT will be managed by Hansteen Limited, a wholly owned subsidiary of Hansteen and will be Hansteen's vehicle for investing in U.K. industrial property with a value of £15 million or less, or portfolios under £30 million.
The Fund, which will be focussed on both high income generation as well as growth in net assets, is targeting annual returns, after fees and expenses, of 12% to 15%. Net income will be distributed quarterly. The life of the Fund will be 6 years.
As Property Adviser, Hansteen will receive an asset management fee and a performance based fee equal to 20% of returns above a hurdle of 10% per annum rising to 30% above a hurdle of 15% per annum.
Day-to-day management of the Fund will be handled by Mark Ovens and James Havery who have recently joined Hansteen from Warner Estate Holdings plc, where they ran the Ashtenne Industrial Fund.
Mark Ovens commented: "The next twenty-four months or so will present compelling buying opportunities; a number of which we are already looking at. We believe we will be able to acquire good quality multi-let property with sound fundamentals at very attractive prices and generate real growth through applying our value focused approach to asset management."
Source: Tavistock Communications