ING Real Estate is pleased to announce the successful acquisition of a portfolio of 128 commercial properties from Abbey National PLC by a syndicate led by ING Real Estate Investment Management (UK Funds) Ltd. The purchase price is in the order of £1.2 billion (1.74 billion). ING will contribute 277 million in equity finance to the transaction.
The properties are located across the UK with a mix of Retail (25%); Office (40%); Industrial (14%); Leisure (3%); Retail/Warehouse (15%); and Other/Mixed use (3%). The portfolio is well leased, with 61% of income secured for over 10 years and 85% for over 5 years. The portfolio has a rent roll of £75 million per annum and total floor area of 6.5 million ft² (0.6 million m²).
The portfolio will be divided between various separate account clients, existing and to be established funds of ING Real Estate in the UK. One of the key beneficiaries of the acquisition will be ING Real Estate's flagship fund in the UK, ING Lionbrook which will purchase £255 million (370 million) of properties growing the fund to over £660 million (957 million). The acquisition will also realign the portfolio to the sectors where greatest outperformance is expected raising the Fund's performance projections to 11% p.a. over the next five years.
Robert Houston, Chief Executive of ING Real Estate Investment Management (UK Funds) said: "With very strong demand for UK commercial property in an evolving market, we are delighted to have secured this acquisition as a portfolio of this magnitude and quality is unlikely to be available again in the near future. Since property yields in the UK have firmed over the last 12 months and further yield compression is expected, we are confident that we have acquired top quality assets for our clients and investors. Moreover, we believe the acquisition will further consolidate our position as one of the market leaders in UK real estate investment management."
Source: ING Real Estate