Kohlberg Kravis Roberts & Co. L.P. today announced that entities advised or affiliated with KKR, including KKR Financial Holdings, have agreed to acquire a 430,000 ft² (approx. 39,950 m²) Retail Park Portfolio from Resolution Property. Financial details of the transaction are undisclosed. KKR has selected Quadrant Estates as the retained Asset Manager.
The portfolio is made up of multi-let retail warehouse space in strong locations in Oxford, Glasgow and Sunderland and contains a combination of food, shopping and retail outlets, as well as bulky goods consent.
Guillaume Cassou, a Director of KKR London and Head of the KKR Europe Real Estate team, said:
"We are excited to be announcing KKR's first European property acquisition, and are delighted that it is in a strong portfolio which combines excellent locations and attractive opportunities for asset management. KKR is perfectly placed to develop the portfolio given the company's experience and expertise in the retail sector with leading companies such as Pets at Home and Alliance Boots. We look forward to doing more such deals in the UK and Europe."
The acquired assets have a strong income profile, with occupancy of 90% and a weighted average lease length of 10 years. The investment also provides operational upside through asset management, let-up, and lease re-gearing.
Christopher Daniel, Director of Quadrant Estates said:
"We have been actively looking at the retail warehouse sector for a long time and these three parks present a very interesting opportunity. They offer asset management value add and a good diversity of tenant mix. We're pleased to be working with KKR on their first direct property investment in Europe, and combining with their experience and knowledge of the wider retail sector."
KKR's real estate investment team seeks to partner with real estate owners, lenders, operators and developers to provide flexible capital to respond to transaction-specific needs, including the outright purchase or financing of existing assets or companies and the funding of future development or acquisition opportunities. The team has access to multiple pools of capital and can invest in private and public real estate opportunities.
Jones Lang LaSalle is the adviser on the transaction.
The transaction is expected to close in the forthcoming weeks.