Close Investments has acquired a 15-property Norwegian portfolio, offering a yield of 7.5 per cent, for the European Property Investment Portfolio, a fund available to retail and instituti
Close Investments has acquired a 15-property Norwegian portfolio, offering a yield of 7.5 per cent, for the European Property Investment Portfolio, a fund available to retail and institutional investors in sterling and euro share classes.
The fund, an open-ended Isle of Man investment company launched last October, invests in commercial property in mainland Europe, including Scandinavia, and aims to deliver a net annualised total return of 9 per cent. The fund can invest in direct property as well as open- and closed-ended European property funds.
‘We are delighted to have signed contracts for the purchase of an EUR85m portfolio of office and industrial properties in Norway,’ says Close Investments Property managing director Martin Towns.
‘Norway has a fast-growing economy, and rental growth looks set to outperform the rest of Europe. In addition, this portfolio offers lots of scope for active asset management. We invested at an attractive initial yield of around 7.5 per cent, with an average lease length of around seven years remaining, compared with a UK average of around five years.
‘Close continues to seek investment opportunities throughout the region. This purchase gives momentum to our European investment strategy and demonstrates that it is possible to seek out assets that should deliver excellent returns in the future.’
The fund’s retail share class carries an initial charge of 5 per cent and an annual charge of 1.75 per cent of net assets, as well as performance fees of 20 per cent for returns about an internal rate of return of 10 per cent and 35 per cent for returns above an IRR of 15 per cent, calculated as a three-year rolling average. The minimum charge is GBP2,000 or EUR3,000, and advisers are offered 3 per cent initial commission and 0.5 per cent annual trail fee.
There is no initial charge and an annual charge of 1 per cent for institutional investors, with a minimum investment of GBP200,000 or EUR300,000.
The Close Investments Property team managed GBP802m in property assets at the end of last year, out of a total of GBP4bn managed by Close Investments. Overall the Close Brothers group manages assets totalling GBP9.1bn.