Sweden’s largest pension fund is poised to invest in its first UK residential venture.
Industry sources say SPP is considering investing at least £10m in Charterhouse’s £250m residential fund.
SPP’s European portfolio manager, Neil Turner, confirmed that one company had been in talks with Charterhouse, but would not comment on whether the group would sign.
“We recognise that there are huge management implications in directly investing in property. A fund is an option. However, we are at the early phases of evaluating the UK market and are looking at other funds and listed companies,” he said.
SPP has ¬625m (£389m) of residential property in Sweden, Netherlands and the US. The fund sees the UK residential sector as an emerging market.
“We were conscious that the UK was an over-regulated market so we were hesitant in investing. We now view the market as a large growth area,” Turner added.
It is also believed that two other European funds, including Dutch fund SFB, plan to sign up with the Charterhouse fund.
It is understood that Charterhouse plans to kickstart the fund with £30m from its investors. The first, Clerical Medical, is considering taking an equity stake of up to £15m.
Set up as a limited partnership, the fund can have a maximum of 20 investors. It is looking for £100m of equity, which will be geared to give it £250m of spending power. If the partnership is successful it may be floated.
Charterhouse director Simon Ringer said: “We are in detailed negotiations and discussions with a number of large investors and institutions.”
EGi News 06/08/99
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