Orchard Street Investment Management increased assets under management by £800m to £2.5bn and completed £580m of investment transactions in 2011.
In September, the specialist commercial property investment manager was appointed by St James’s Place Wealth Management as investment manager of more than £800m of property funds.
The mandate includes the St James’s Place UK Life and Pension Property Fund and the St James’s Place Authorised Property Unit Trust.
Following this appointment, Orchard Street recruited six new team members including Richard Walters, Michael Cecil, Ian Gibson, and Lawson Shepherd, all of whom worked at the former investment manager Invista Real Estate Investment Management.
Since January 2011, Orchard Street has been an active investor across all the various client funds under management. In total, it has acquired 19 properties with a combined value of £414m.
Of these, seven were retail assets, boosting retail assets under management to over £1bn.
Key purchases included the Old George Mall shopping centre in Salisbury for £80m; Cardiff Bay Retail Park for £54.5m; and 61-65 Conduit Street, W1, for £36m.
Orchard Street also completed sales totalling £167m including Marble Arch Tower, W1, Belvedere – a 102,000 sq ft office building in Manchester, and 60 Cannon Street, EC4. The average initial yield on acquisitions was 6.3% and on disposals 5.7%.
Asset management activity included over 850,000 sq ft of new lettings, lease renewals and lease restructurings with a total rental value of around £12.4m.
At the end of 2011, vacancy levels across all portfolios were comparable in the range of 3-5% in all cases.
Orchard Street chairman Chris Bartram said: “In a challenging market we believe that we have postioned each of our client funds well for further outperformance. We have also taken the opportunity to grow our team to a total of 17 professionals.
“Over the year ahead, while there is much uncertainty in the politics and markets that surround us, we are comfortable to have fairly fully invested client portfolios, which produce an income yield, in all cases, significantly in excess of the other principal investment sectors in UK, and which have low vacancy.
“Our style is to focus on the active management of assets chosen with that potential in mind, and that will remain our priority in the months to come.
“We also anticipate that we will have capacity for new investment, or sales and re-purchases over the year, and will be watchful for any market weakness to stimulate that activity.”
bridget.o’connell@estatesgazette.com
