Hines has secured a €80m (£69m) commitment from Border to Coast Pensions Partnership, the largest UK Local Government Pension Scheme pool, for its latest closed ended European value add fund.
The fund, called Hines European Real Estate Partners III, held its final close at the end of November.
The total number of investors in the fund has reached 35, with a mix of existing and new investors in addition to Hines’ co-investment.
Border to Coast is the second LGPS investor to partner with Hines in recent years, following Greater Manchester Pension Fund which committed to the Hines US Property Partners in 2022.
Since the fund’s launch in mid-2022, HEREP III has raised more than €1.6bn of equity commitments, exceeding its €1.5bn target.
HEREP III has allocated more than €300m of equity to assemble an initial portfolio of four assets in three markets.
The investment period for the fund is expected to continue until mid-2026 and will prioritise three key sectors: purpose-built student accommodation, distribution logistics and highly sustainable office spaces in prime locations. Hines said those sectors have “significant unmet demand and present opportunities for ongoing rental growth”.
Alistair Smith, head of real estate at Border to Coast, said: “After carrying out extensive due diligence, we believe that Hines and the Herep III team have the capability to help us deliver the objectives of our global value-add fund, providing investment capital appreciation and diversification for our partner funds.”
Paul Campbell, real estate portfolio manager at Border to Coast, said: “Border to Coast has strong focus on ESG factors and the impact this will have on asset values in the longer term. Partnering with Hines, a real estate specialist investment manager with strong ESG credentials, will enable us to deliver for our partner funds.”
To send feedback, e-mail pui-guan.man@eg.co.uk or tweet @PuiGuanM or @EGPropertyNews
