Starwood Capital and Tunstall Real Estate Asset Management have bought regeneration company Pinnacle Group from the Cheng family, the owners of Greenwich Peninsula developer Knight Dragon.
Pinnacle specialises in long-term local authority partnerships. It employs 2,300 people, has a turnover of more than £90m and has been in business for around 20 years.
In the past 10 years Pinnacle has invested £600m in housing-led regeneration projects, including the Oval Quarter in Camberwell, SW9, and the Myatts Field North project in Lambeth, SE5.
It is also undertaking the Sheerwater regeneration masterplan in Surrey, which will deliver 952 new homes.
The 50:50 joint-venture partners are understood to have paid £50m-£60m for the business. It is the first deal for Tunstall since it was established last year with the backing of M7 Real Estate and a number of overseas family offices. It is run by Roger Clarke, former head of investment banking at Stifel.
Under its new ownership, Pinnacle will continue to invest in mid-range schemes in outer London and beyond. It is understood to be bidding on a site in Havering.
Clarke said the group was distinguishing itself from competitors by providing services such as property management and could therefore offer more long-term involvement in schemes than a traditional housebuilder.
“The acquisition of Pinnacle, alongside the existing management team, together with our planned investment into its pipeline of current and future projects, represents a compelling opportunity for us,” he added.
The deal was originated by private equity firm Starwood, after it bid on several sites in partnership with Pinnacle: most recently, the pair were under-bidders on Haringey’s controversial £2bn Development Vehicle.
M7 and Starwood have a close working relationship, having undertaken a series of joint ventures across Europe – largely focused on the light industrial sector.
