Aviva Investors is offloading €195m (£155m) of assets to private equity investor Lone Star after calling time on one of its European property funds.
The fund manager is winding down the Aviva Investors Central European Property Fund. It holds a 60% stake in the vehicle through a number of entities including a “major” contribution from its Life Fund series.
The remainder of the investor base in the pan-European closed-ended vehicle comprises institutions including CBRE Global Investors and pension funds.
It is understood that Aviva was keen to liquidate the 2005 vehicle, which had an initial 10-year life, to return money to its Life Fund, which has continual cash requirements.
It has now agreed an off-market deal with Lone Star for the office, logistics and retail assets.
The US firm has been one of the most acquisitive investors in Europe this cycle, buying a number of non-performing loan portfolios, including a majority of €7bn (£5.2bn) of IBRC loans at the beginning of this year.
As the market matures in the UK and Ireland, opportunistic investors like Lone Star are looking to find value on the Continent, where they can benefit from improving values as the recovery spreads.
AICEPF comprises 65% offices with the balance split between industrial and retail. Half of its assets are in the Czech Republic and 25% in Poland.
It was the second European vehicle the pensions giant launched after deciding to move into continental property a decade ago.
The vehicle invested directly in a diversified portfolio of office, industrial and retail property.
The fund had a target equity base of €200m and was geared on a 50% loan-to-value basis, allowing a €400m property portfolio to be assembled over its three-year investment period.
All parties declined to comment.
Bridget.O’Connell@estatesgazette.com
