German real estate company Patrizia has bought three business parks in the UK from Hermes Real Estate Investment Management, as they both position themselves for growth in the UK market.
Patrizia Immobilien completed the deal to buy Hillington Park in Glasgow, Chineham Park in Basingstoke and Birchwood Park in Warrington for Β£430m (β¬540m), with its joint venture with US hedge fund Oaktree Capital Management becoming the new owner.
Arwed Fischer, CFO of Patrizia Immobilien, said: βPatrizia is well positioned to continue its growth in Great Britain.β
He said the companyβs UK subsidiary was analysing other office as well as residential-led opportunities in attractive locations across the country.
Patrizia now manages nearly β¬1bn of property in the UK, having built up the portfolio in less than 18 months, he said.
Rob Brook, head of portfolio management at Patrizia UK, said all three of the parks were well established.
βAt the same time, they offer significant development potential, as they are situated in highly dynamic regions,β he said.
βOver the next few years, we will leverage this potential value with new investments and intensive asset management in cooperation with Oaktree Capital Management,β said Brook.
Brook founded London-based Tamar Capital Group, which was bought by Patrizia last year as it moved to enter the UK market. The resulting UK subsidiary established its first joint venture with Oaktree Capital Management in May 2013.
Hermes Real Estate said it was selling the three mixed-use parks β held by its subsidiary MEPC β to free up capital in order to invest in emerging growth sectors of the UK economy.
Chris Taylor, chief executive of Hermes Real Estate and chairman of MEPC, told IP Real Estate that, even though there clearly was growth in real estate in the UK regions, Hermes Real Estateβs job was to position the portfolio for maximum growth.
βThere are broad investment themes which will drive above-average growth,β he said, adding that these themes were around urbanisation linked to connectivity. There were an increasing number of technology companies outside London that wanted to be in an urban environment, he said.
Added to this, there was βa degree of concernβ over the level of pricing in the UK regions for income producing assets, he said. βIn a market thatβs looking expensive, youβve got to work awarder to find growth,β he said.
