Delancey nabs £900m Blade brief

News

Annabel Dixon and Mike Phillips

06 February 2010

Jamie Ritblat’s Delancey is to take on the asset management of a portfolio of properties secured by a £900m Royal Bank of Scotland loan.

The selection signals one of the largest loan restructurings of the downturn so far.

The loan relates to 13 properties owned by Glen Maud’s Propinvest. The portfolio, known as Project Blade, includes the 1.3m sq ft East Kilbride shopping centre, bought by Propinvest for £400m in 2007, and the 500,000 sq ft Mander shopping centre in Wolverhampton, which it bought for £120m later the same year.

As asset manager, Delancey will be tasked with reducing vacancy rates and increasing income across the portfolio.

It will receive a fee for managing the assets and will share capital expenditure requirements with RBS. A number of properties from the portfolio may be sold to raise capital for reinvestment in the remainder of the portfolio.

Propinvest is understood to be retaining an active involvement in the portfolio that could lead to it continuing to manage some properties.

The deal has also been structured so that Delancey, RBS and Propinvest can enter into profit-share agreements if certain value and income hurdles are surpassed.

Delancey beat competition from Catalyst Capital, LaSalle Investment Management, Balmain Asset Management and DTZ to win the mandate.

A source close to the deal said: “This is a consensual restructuring, and Delancey’s involvement stems from its long-standing relationship with RBS. The company will continue to pursue this kind of business, and it is definitely part of its ongoing strategy.”

The business has pitched for a number of asset management mandates over the past few months, including Castlemore Securities’ circa-£1bn portfolio.

EG revealed late last year that accountancy firm Ernst & Young had been instructed to find a new asset manager for the Blade portfolio, which was once valued at more than £1bn (21 November, p30).

Delancey, Propinvest and RBS declined to comment.

Delancey has also completed its purchase of 40 Holborn Viaduct, EC1, for more than £90m. The 178,000 sq ft office was owned by Castlemore. RBS was the lender.

The deal is understood to be a consensual restructuring between the bank, the original borrower and RBS.

Investors were first sounded out on the property last June. It then had a value of around £60m.

Jamie Ritblat’s Delancey is to take on the asset management of a portfolio of properties secured by a £900m Royal Bank of Scotland loan. The selection signals one of the largest loan restructurings of the downturn so far. The loan relates to 13 properties owned by Glen Maud’s Propinvest. The portfolio, known as Project Blade, includes the 1.3m sq ft East Kilbride shopping centre, bought by Propinvest for £400m in 2007, and the 500,000 sq ft Mander shopping centre in Wolverhampton, which it bought for £120m later the same year. As asset manager, Delancey will be tasked with reducing vacancy rates and increasing income across the portfolio. It will receive a fee for managing the assets and will share capital expenditure requirements with RBS. A number of properties from the portfolio may be sold to raise capital for reinvestment in the remainder of the portfolio. Propinvest is understood to be retaining an active involvement in the portfolio that could lead to it continuing to manage some properties. The deal has also been structured so that Delancey, RBS and Propinvest can enter into profit-share agreements if certain value and income hurdles are surpassed. Delancey beat competition from Catalyst Capital, LaSalle Investment Management, Balmain Asset Management and DTZ to win the mandate. A source close to the deal said: “This is a consensual restructuring, and Delancey’s involvement stems from its long-standing relationship with RBS. The company will continue to pursue this kind of business, and it is definitely part of its ongoing strategy.” The business has pitched for a number of asset management mandates over the past few months, including Castlemore Securities’ circa-£1bn portfolio. EG revealed late last year that accountancy firm Ernst & Young had been instructed to find a new asset manager for the Blade portfolio, which was once valued at more than £1bn (21 November, p30). Delancey, Propinvest and RBS declined to comment. Delancey has also completed its purchase of 40 Holborn Viaduct, EC1, for more than £90m. The 178,000 sq ft office was owned by Castlemore. RBS was the lender. The deal is understood to be a consensual restructuring between the bank, the original borrower and RBS. Investors were first sounded out on the property last June. It then had a value of around £60m.