Miller Developments is about to buy the entire UK portfolio of one of Israel’s biggest property companies for £215m.
In its largest investment deal to date, Miller has struck a deal to buy the 836,000 sq ft portfolio of Alony Hetz, an investment company listed on the Tel Aviv Stock Exchange.
A source close to the deal said Miller had not been among the early bidders for the portfolio, but stepped in after talks with Allied London collapsed. The £215m purchase reflects a yield of around 7%.
The source added that chief executive Phil Miller was likely to trade around £100m-worth
of the portfolio in the short term, but had not yet identified which properties the company would sell.
The purchase takes Miller’s investment spend to £335m this year, more than double its original £150m target. Its spending had been slow as it struggled to find suitable product, but gained ground last month when it bought a £43m mixed-use portfolio of 15 properties from Invesco, a 7.7% yield. That deal brought Miller’s spend on investment properties to £120m.
The Alony Hetz portfolio was built up largely through acquisitions from British Land and comprises eight properties retail and offices in major English and Scottish cities.
They include the 225,000 sq ft (21,000 sq m) former Gateway head office complex, Somerfield House in Bristol; an 80,000 sq ft (7,400 sq m) Customs & Excise office next to Spinningfields in Manchester; and the 50,000 sq ft (4,600 sq m) Dawson House in Jewry Street, EC3.
Alony Hetz instructed portfolio specialist Roualeyn Cumming-Bruce, head of national investment at Jones Lang LaSalle, to handle the sale of the package in June (29 May, p33).
Miller was unrepresented.
References: EGi News 22/11/04
