Octopus Property launches next institutional real estate debt fund
06 October 2017
Octopus Property, the specialist UK property lender and part of Octopus Group, today announces a first close of £115 million for its second commercial property debt fund (‘the Fund’), an institutional debt strategy focused on the UK commercial property market.
Octopus Property is one of the UK’s leading non-bank lenders, providing bespoke financing facilities secured on commercial, development and residential property. Since 2009, it has lent in excess of £2.6 billion across c. 2,600 loans.
The launch of its second commercial property debt fund follows the successful deployment of CREDF I, a £130 million fund launched three years ago, and CREDF-S, a £35 million fund raised from existing investors in 2016 due to sustained institutional demand. The two funds have completed more than £420 million of lending, secured against commercial real estate across mainland UK. CREDF I has returned a gross IRR of 12.6% to June 2017. The Fund will provide sufficient funding to complete loans with a combined value in excess of £500 million over the next three years.
Ludo Mackenzie, Head of Commercial Property at Octopus Property and manager of the Commercial Real Estate Debt Funds, said: “Repeat commitments from CREDF I investors, together with new investment, are testament to the continued strength and growth of the business as well as the successful track record of CREDF l and CREDF-S. There remains a real need for commercial property finance in the UK market, and we have built a reputation and track record of delivering bespoke solutions, quickly and efficiently.
“From a borrower’s perspective, we provide loans that are more versatile than traditional bank finance and cheaper than private equity. From an investor’s perspective, CREDF I has been able to deliver returns that are comparable to equity funds.”
Mario Berti, Chief Executive Officer of Octopus Property, added: “The launch of our second commercial property debt fund is an exciting opportunity for our commercial lending team, who have demonstrated their ability to deploy capital across a range of lending opportunities and deliver attractive returns.”
Simba Capital is acting as Placement Agent and Macfarlanes is providing legal support for the Fund.
This press release is issued by Octopus Investments Limited which is authorised and regulated by the Financial Conduct Authority. The information contained within this press release does not constitute an offer or inducement to participate in a collective investment scheme, alternative investment fund or any other financial product and may not be treated as an offer or inducement in any jurisdiction where such an offer or inducement is against the law, or to anyone to whom it is unlawful to make such an offer or solicitation, or if the person making the offer or solicitation is not qualified to do so. For the purposes of the UK Financial Services and Markets Act 2000 (‘FSMA’), the Fund is an unregulated collective investment scheme which has not been authorised or recognised by the FCA. Unregulated collective investment schemes may only be promoted to persons falling within one or more of the exemptions from the scheme promotion restriction in section 238 FSMA. While this press release is not considered to be a financial promotion, only the following persons should consider the information contained within this press release:
- investment professionals falling within article 14 of the FSMA (Promotion of Collective Investment Schemes) (Exemptions) Order 2001, as amended (the “CIS Order”), being, in summary, persons with professional experience of participating in unregulated schemes;
- high net worth entities falling within article 22 of the CIS Order, being, in summary, bodies corporate with called-up share capital or net assets of not less than £5 million, or if the body corporate has more than twenty members or is a subsidiary undertaking of an undertaking with more than twenty members, £500,000; unincorporated associations or partnerships with net assets of not less than £5 million; and trustees of high value trusts; and
- other persons to whom the may lawfully be promoted in accordance with the CIS Order or the FCA’s Conduct of Business Rules.
No person outside those categories should consider or rely on the information contained within this press release for any purposes whatsoever.
The ability to invest in the Fund is only available to certain persons, being, in summary investment professionals and high net worth entities as described above and certain certified high net worth and sophisticated investors.
The value of investments, and the income from them, may fall or rise. The information in this document should not be construed as offering investment or tax advice.
Octopus Property and Octopus Healthcare merged to form Octopus Real Estate.