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Investor demand prompts second share issue for LCP’s third Prime London residential fund

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London Central Portfolio (LCP) is providing a limited opportunity to purchase new shares in the firm’s third fund, London Central Apartments (LCA). 

 
This announcement is in response to significant investor demand to participate in LCA since it closed to new subscriptions in March.
 
LCP’s Prime Central London property funds provide benefits that investors acting on their own do not get – diversification, professional expertise, market leverage to source and buy the best properties and a hands-on management service. It also enables investors to access this market for a fraction of the direct investment cost.
 
LCA has been putting together a portfolio of one and two bedroomed flats in the prime postcodes around Hyde Park, designed to appeal to the blue chip tenant and with potential for a significant uplift in values.  Having closed in March 2013 following a successful equity raise, LCA is nearing the end of its acquisition phase and is on the last stretch of its refurbishment programme.
 
The number of additional shares on offer will equate to 10 per cent of the initial share issue and will be sold at the original price of GBP10 per share. The shares will be allocated on a first in line basis and the offer is open until 30 September, or earlier, if fully subscribed.
 
Naomi Heaton, chief executive of LCP, says: “It appears that residential property in Prime Central London has finally carved its place as a significant player in a balanced portfolio, no longer looked upon as commercial property’s poor relation. The credit crunch has played a large role in this. Bouncing back to health by 2010 prices are now up by 34 per cent from their 2008 high. Commercial property still flags and the FTSE 100 has only just pipped its previous high by a couple of percent. We are delighted to see this breakthrough and to welcome new investors into the fund.”
 
Heaton’s comments come as the just released quarterly Land Registry results, reported by LCP yesterday, have shown residential property continuing to storm ahead in Prime Central London. Average prices grew 7.2 per cent this quarter to reach GBP1,472,181. Transactions also rose 11.6 per cent.
 
Whilst performance figures have yet to be posted for the entire LCA portfolio, LCP’s previous funds have demonstrated exceptionally strong results at their most recent valuations. Closed in 2007 and 2010, these funds have shown 41 per cent and 44 per cent increases respectively in capital value since acquisition. Whilst past performance of their existing funds is not necessarily a guide to the future, they are on track to achieve their target returns.
 
The minimum subscription price for the new shares is set at GBP50,000 for individuals or less through a regulated entity. LCA is projecting an IRR of 10 per cent – 12 per cent per annum after five years and is structured to accept investments through SIPPs, QROPS and offshore portfolio bonds. As the UK’s first Sharia compliant residential fund, it has global reach appealing to both conventional and ethical investors.

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