Malls are base of £350m fund
Shrewsbury's three shopping centres form the base of a new £350 million fund. The UK Shopping Centre Fund was launched by EFM Asset Management and Protego Real Estate Investors, which bought the Darwin, Pride Hill and Riverside malls in April for £120 million.
The first close of the £350 million fund contains a seed portfolio of the three linked shopping centres in Shrewsbury covering 430,000 sq ft.
The launch follows fundraising which was oversubscribed and saw Protego and EFM raise around £50 million against an initial first close target of £30 million.
Investors were institutions from the UK and the Netherlands and included Achmea Real Estate and Fortis Investments, acting on behalf of their clients.
The target for the second close is a minimum of £80 million, giving a total potential fund value in excess of £350 million with the introduction of debt. Protego and EFM have co-invested.
It is intended that the fund will, at any point, house three or four shopping centres, which will be held typically for periods of between three to five years.
Protego, which will be investment manager to the fund, chose EFM as a strategic partner due to its strong track record of demonstrable out-performance in this sector and its unique ability to provide asset and facilities management, as well as mall trading, construction and security.
The second and final closing of the fund is expected by early November 2006, for which Protego and EFM have already experienced strong expressions of interest from investors wishing to participate.
The fund is a 10-year closed-ended offshore Jersey property unit trust.
It will provide investors with access to a portfolio of shopping centres in the UK which will be intensively managed to improve returns. Individual properties will have a value in excess of £60 million.
Hugo Llewelyn, principal at Protego said: "The key differentiator for the fund is the intensity of the investment and asset management approach. This is not an asset gathering fund - once the value has been extracted, the asset will be sold.
"A combination of Protego and EFM investment, asset and property management skills mean that we are well placed to reposition our target centres.
Charles Weeks, principal at Protego, said:"We are delighted with the levels of investment at first close and the speed, over a period of two or three months spanning the summer, with which we were able to bring it all together. This significantly exceeded our expectations and is a strong endorsement of our strategic approach to shopping centres in the UK, as well as the skill sets of Protego and EFM."
David Revill, chairman of EFM, said: "The co-investment and launch of this fund represents a new and exciting direction for EFM. With our ability to enhance revenue streams by influencing all aspects of shopping centre management, I am confident the fund will be a great success."
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