The proposed fund will be looking from a wide range of property, across the office, retail and industrial sectors leading on from the previous James Caan fund this further demonstrates the growing appetite amongst investors to strike whilst there is a 45% decline in values.
Commercial property had an awful 2 years after the credit crisis hit in the summer of 2007, but now values have levelled in the last two months as overseas buyers and entrepreneurs make acquisitions. Britain’s biggest property companies, like British Land, are eyeing the market for opportunity. They have £5bn or so in equity to sort out their troubled balance sheets.
Data from Cushman & Wakefield (C&W) suggested that the value of transactions in London rose 12% to £1.6bn in the Q3 against Q2, showing the first consecutive 2 month rise since2007.
Now BNP Paribas look to raise capital for their Real Estate UK Income and Growth Fund that will be geared towards acquiring prime assets, banks needing to get rid of properties from their balance sheet, and corporate entities looking to do sale and leaseback deals.
The fund will run for five years, although apparently there will be the option for an additional two. The fund will also look to fuel its acquisitions by raising debt not greater than 50%.