Northacre plc, the prime London residential property developer and Evans Randall, the privately held UK investment banking and private equity group, have today announced a 50/50 partnership that will mark Evans Randall's entrance into the UK residential property market.
The venture will grant Evans Randall exclusivity to embark on debt raising and to provide equity for future developments in Central London on a project by project basis, with Northacre providing high-end residential design and development expertise. Evans Randall will co-invest in projects, as well as raising equity from its impressive client base in the UK, Europe, the Middle East and the Far East.
The partnership will mean that Northacre will be able to take advantage of the numerous opportunities currently available in the Central London market, giving Northacre the advantage of securing these schemes without the uncertainty of the sources of finance, which is presently a challenge for almost all property development companies.
A number of current opportunities are being investigated with the partnership looking at bespoke small-scale developments and longer-term major projects, including joint ventures with third parties, to generate a steady sales pipeline and strong cash-flow. Evans Randall may retain an interest in specific developments to compliment their existing portfolio of iconic, city centre commercial buildings.
Northacre has an unrivalled reputation in the London market and has completed a significant number of large-scale prime developments in and around Kensington and Chelsea, including the The Bromptons, Observatory Gardens and The Phillimores. Northacre is also one of the two development partners on the Lancaster's, a development, of 77 residential apartments on London's Lancaster Gate, W2, scheduled for completion in early summer 2011.
Each of Northacre's projects to date has had a significant positive impact on values in the area surrounding the development. This 'ripple effect' is an important element in making an individual project attractive to owners of other properties in these locations.
Michael Evans, Chairman of Evans Randall, said: "Our partnership with Northacre signals a strategic move into prime residential property, which we believe will complement our existing commercial property interests. Northacre has been responsible for a large number of the leading prime developments in London's most sought after locations and their experience and professionalism is unrivalled.
Prime Central London residential property has performed well despite the recession with prices rising by up to 20 per cent in the last year. The market has seen strong interest from overseas homebuyers and investors, in part attracted by a favourable exchange rate, demonstrating that there is a sustained global appetite for well-designed, prime residences in central London."
Klas Nilsson, Chairman and CEO of Northacre commented: "To secure a partnership of this type with Evans Randall in the current difficult financial climate demonstrates the strength of the Northacre Group. This deal will allow our companies to capitalise on our respective skills without diluting the qualities of the Northacre brand. With access to capital from Evans Randall's impressive client base, we can take advantage of the current and future opportunities in the Central London market. We look forward to a long and very successful partnership with Evans Randall."
In the last five years Evans Randall has become a leading investor in landmark commercial real estate assets in both the UK and Western Europe, having acquired a portfolio of more than £5 billion. Its track record in completing transactions quickly and effectively and its strong banking and equity investor relationships are fundamental to its ability to exploit opportunities offered in the current market.
Source: FD
