Moorfield Group (Moorfield), a UK focused private equity real estate fund manager, has successfully completed its final close for Moorfield Real Estate Fund III (MREFIII) with £250 mln (€318 mln) of discretionary equity capital commitments and over £100 mln (€127.5 mln) of co-investment equity capital commitments, which combined provide MREFIII with more than £350 mln (€446 mln) of equity capital for investment.
Moorfield will also supplement this equity with joint venture capital meaning that Moorfield expects to invest c.£500 mln (€637 mln) of equity over the next three years, employing leverage alongside this as appropriate.
The MREFIII investor base consists of a group of investors split broadly equally between existing and new relationships with the investors coming from the US, Europe and Japan.
Marc Gilbard, Chief Executive Officer of Moorfield said: “We are satisfied with this successful fund raising which gives MREFIII the flexibility to deploy a significant amount of leveraged capital in the UK real estate markets. We are grateful for the support and confidence of our existing and new investors and are pleased to have been able to expand our investor base in terms of geography and investor type.”
MREFIII is a UK focused opportunistic/value-add fund with a targeted risk adjusted internal rate of return (IRR) of c.15-20% and an equity multiple of c.1.5x-2.0x. Moorfield looks to identify investment opportunities where equity returns can be enhanced with active asset, operational and financial management. MREFIII will be targeting sectors and sub-sectors with attractive supply and demand dynamics.
MREFIII’s most recent acquisition is Aurora in Ealing, West London, which was bought from Threadneedle Investments for £22 mln (€28 mln) in an off-market transaction in late December 2014.
Aurora is a prominent Grade A headquarters office building in the Ealing office core. Built in 1996 and comprising 51,943 ft² (4.738 m²) over the ground and 4 upper floors, Aurora is let in its entirety to market research company Dunnhumby until May 2016.
MREFIII is working in joint venture with XLB Property on Aurora and JLL advised Threadneedle Investments.