Legal & General Property delivers pre-let developments.
01 February 2011
Legal & General Property (“LGP” / the “Company”) announces the practical completion of its distribution warehouse development at Innova Park in Enfield, one of two industrial developments forward funded in 2010 by LGP on behalf of its Managed Fund. Works are progressing well at the Fund’s second forward funding project at G. Park Crick, at Junction 18 of the M1 Motorway, where the development is on budget and on target to reach completion in December 2010.
Located 13 miles north of Central London, the Enfield property comprises an 84,620 sq ft warehouse/office unit with parking over a five acre site. Starting in February this year, the property was developed by Graftongate and has achieved a BREEAM ‘very good’ rating, further enhancing the environmental credentials of properties held by the Fund. John Lewis Partnership has agreed a 20-year lease, which will further underpin the income profile of the Fund.
At G. Park Crick, works are progressing well on a state-of-the-art 260,000 sq ft warehouse, funded by LGP and developed by Gazeley. Located in one of the most sought-after distribution parks in the Midlands, the warehouse has been pre-let to Butchers Pet Care Ltd for a term of 20 years.
The Managed Fund is LGP’s flagship property fund for UK pension funds. Having been established in 1971, it invests on behalf of over 300 occupational pension funds. The Fund has recently been building on the increased allocation from pension funds for real estate through new purchases of c. £300m in the year to date 2010. The Fund has delivered top quartile returns over rolling one and five year periods against the benchmark.
Mark Russell, Fund Manager at Legal & General Property, said:
“In a period when income is anticipated to be the dominant driver of total returns, the already secure nature of the Fund’s rental stream will be further enhanced by these deals. The excellent quality of the stock is crucial in maintaining occupier demand, when tenants will be increasingly examining operational efficiencies, and the strong sustainability credentials of the assets offer a degree of ‘future-proofing.”
Charlie Walker, Senior Fund Manager at Legal & General Property, added:
“These two transactions leveraged a market starved of finance and institutional funding for pre-let developments. The funding margin of 75-100bps, earlier in the year when these deals were struck, has certainly eroded since, which further underpins the quality of these transactions.”
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Notes to editors
Legal & General:
Legal & General Property (LGP) is a wholly-owned subsidiary of Legal & General Investment Management (LGIM) and one of the largest institutional property fund managers in the UK. LGIM had funds under management of over £342bn as at 30 September 2010, whilst LGP manages or co-manages 16 separate funds or vehicles and 2 segregated mandates, with an aggregate asset value of over £9.4bn as at 30 September 2010. These funds include:
Specialist Pooled Funds
The Leisure Fund Limited Partnership; Industrial Property Investment Fund; UK Logistics Fund; Arlington Business Parks Partnership; and the English Cities Fund
Single Asset Vehicles
Bracknell Regeneration Partnership; Central Saint Giles Partnership; Performance Retail Limited Partnership and Warrington Retail Limited Partnership
Life Fund; Linked Pensions; Linked Life; Managed Fund; Property Unit Trust, UK Property Income Fund; and LPI Income Property Fund.
LGP’s UK-focused fund management platform has built and retained a strong track record of out-performance across the sector. Owing to its size, diversity and penetration, it benefits from best in class banking and property industry contacts which, along with its wealth of in-house skill and expertise, have enabled it to continue to attract and secure high quality market opportunities. Taking a client-centric approach, the business places the highest priority upon integrity and transparency. Sector specialists cover each sphere of the market and are supported by LGP’s market-leading research capability.
LGP’s sector specialism’s cross all facets of the real estate market. In particular, the Company has a major development platform, responsible for delivering the West End office market’s latest landmark, Central Saint Giles, and currently involved in developing two further high profile London schemes, Walbrook Square and Agar Street, as well as significant town-centre retail regeneration projects, including Bracknell, Northampton and Eastbourne.
For more information please contact:
PR Manager Investments
t: +44 (0) 2031 242096
About Legal & General
Legal & General Property Limited.
One Coleman Street
London EC2R 5AA.
Registered in England 2091897.