LaSalle raises £600million across its debt strategies platform
LaSalle announced that its European Debt Investments & Special Situations business has had a strong first half to 2017 and has raised nearly £600 million across its debt strategies platform.
LaSalle has extended its successful LaSalle Residential Finance programme (“LRF”), which has APG as its largest investor, to £704m with new commitments totalling £264m for LaSalle Residential Finance III. In line with LRF I and II, LRF III will focus on lending on assets in the UK, intended to be developed or re-developed for use as student housing, residential accommodation, hotels or healthcare-related property. The vehicle provides borrowers with whole loan solutions for larger and/or higher leverage developments at loan-to-cost ratios of up to 80% with loans ranging from £15m to £100m+. LRF I and II have invested nearly £500m since 2013, including a £110m whole loan to Telford Homes and Business Design Centre in Q3 2016 to fund the City North development, a 355 unit residential led mixed use scheme in Finsbury Park. The new LRF III commitment will enable LRF to further grow its position as a market leader in development finance.
Additionally, LaSalle’s most recently launched fund in its debt series, LaSalle Real Estate Debt Strategies III (“LREDS III”), has secured aggregate commitments of £334m to date and is well on track to exceed the £600m raised for the prior fund. The fund’s primary geographical focus is the UK but it also invests across Western Europe and the Nordics. The fund strategy is to focus on lending against quality assets with best in class sponsors; the combination of which offers compelling risk adjusted returns across mezzanine and whole loan investment opportunities.
LREDS III has already extended a £38m, five-year mezzanine facility to finance the acquisition of a UK portfolio with an aggregate purchase price of £191m, sponsored by clients of BMO Real Estate Partners. The portfolio is composed of three assets encompassing 853,000 sq ft of real estate, including a department store in the city centre of Manchester and two retail parks; Clifton Moor Retail Park in York, anchored by Tesco, and Westgate Retail Park in Wakefield. The trio of assets is located in strong UK sub-markets and provides high quality long term income.
Amy Aznar, Head of Debt Investments and Special Situations at LaSalle Investment Management, said: “We have been very active across the debt lending space, where we are able offer borrowers a broad range of debt solutions. The team has built on a successful 2016 with a strong first half of 2017, and continued fund raising for LREDS III and an extension of the LRF programme. As a result, our funds strengthened their positions as well-established lenders in the market. We have started with an excellent first deal for LREDS III and are now actively pursuing debt investments which fit within both our LRF and LREDS lending strategies.”
Simon Marrison, CEO of Europe for LaSalle Investment Management, added: “We have long been believers in real estate lending; in a low-interest rate environment, this is one of our most secure income yielding strategies. In the UK, the partial retreat of traditional lenders from development finance and higher LTV loans will continue to generate opportunities for non-traditional real estate lenders. Amy and her team have had a very strong start to the year and I expect to see continued significant demand for our flexible loan products in the future.”
LaSalle’s Debt Investments and Special Situations team, headed by Amy Aznar, has a strong track record of developing strategic relationships with best-in-class borrowers and senior lenders, and has significant experience across various sectors, geographies, deal sizes and capital structures. Since 2010, the team has committed £1.8bn ($2.2bn) of investments in 47 individual transactions and secured against £8.6bn worth of real estate.
Source: LaSalle Investment Management