Global expands and diversifies its real estate holdings in UK

Acquisitions raise total value of managed assets to $400m

Nasser Al-Khaled

KUWAIT: Acting on behalf of its clients, Global Investment House (Global), a regional Asset Management and Investment Banking firm headquartered in Kuwait with offices in major capital markets in the MENA region, has unconditionally contracted to acquire two institutional grade retail warehouses in the towns of Bury, in the greater Manchester area, and in the large seaport town of Grimsby, UK.

The properties are let to B&Q Plc, a leading retailer in the DIY (Do-It-Yourself) and home improvement retail sector, on full repair and insurance leases that are subject to annual RPI-Linked, upward only rent reviews, with a 12-year certain unexpired lease term.

Structured as one transaction, this acquisition provides clients a sharia compliant structure enjoying a stabilized income stream with strong rental growth prospects and expected net annualized cash dividends exceeding 8 percent with annual growth opportunity of 2 to 3 percent.

This marks the sixth transaction under the UK National Commercial Real Estate Program which Global’s real estate asset management team launched, in partnership with London based Greenridge Investment Management Limited, including eight properties with total value around $400 million. Launched in September 2015, the Program strategically identifies off-market investment opportunities outside in regional UK cities outside of London which produce rental income derived from Investment Grade or Government tenants on long-term triple net leases.

On this occasion, Head of Real Estate Asset Management at Global Nasser Al-Khaled, commented: “This acquisition affirms our strategy to diversify our portfolio and demonstrates our continued pursuit of identifying value growth prospects in other sectors within the greater UK property market. We see great opportunity in the retail warehousing sector due to its resilience to the rise of the ecommerce industry. Moreover, the thriving housing construction market witnessed currently in the UK and its growth prospects further supports the rationale behind the perceived value proposition in this sector.”

He added: “We currently manage a very strong and focused portfolio of properties in the UK and look forward to continue this path of growth in collaboration with our partners. Despite current political uncertainty over Brexit negotiations and a weaker sterling, the UK has proven to be a very resilient market, and we are confident in the sustainability of our performance to meet our investment targets. We are now among the institutions that have proven their credibility and professionalism in one of the target markets and are looking expand this success to other international markets”.

“He concluded: “This transaction also reflects Global’s strategy to grow its real estate asset management business and increase the share of real estate assets from total assets under management”.

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