UK commerical property fund aimed at providing regular and solid invesment returns

Written by Ray Clancy

Wednesday, 28 April 2010 10:00

A commercial property fund aimed at attracting investors who may not have had access previously to a high quality property portfolio offering regular and solid returns has been launched.

Hamilton Capital Partners, the boutique investment house that specialises in investment in select commercial properties in the UK, has established a new £30 million commercial property fund primarily as a vehicle for private investors but has also been successful in attracting interest from SIPP and SSAS investment advisers.

The fund offers the opportunity to invest in properties occupied on long leases by blue chip tenants including government departments, G4S and Nuffield Health, the company says.

Investors are offered an anticipated IRR of 12% to 15%, annual distribution of 5% per annum and a maximum seven year life of fund. While the portfolio of initial properties, located in the North East of England and Scotland, deliver a combined rental in excess of £1.7million with approximate yield of 7%.

The fund has completed the acquisition of MacFarlane House in Glasgow for £5.75 million. The property is leased to G4S Cash Services (UK), a subsidiary of G4S plc, for a further 18 years.

‘We are pleased that our first formal fund has stimulated such strong levels of interest from investors who prefer to become involved with a fund where they can see directly where their money is being invested, as opposed to very large and somewhat faceless superfunds,’ said HCP Partner Paul Johnston.

‘This fund is aimed at investors who are looking for solid returns without undue risk although we believe that exceptional returns can and will be delivered through active management of these properties. With savings interest rates being so low at the moment, we have noticed an increase in demand for this type of investment,’ he explained.

‘In recent months, there have been clear indications that this is the right time to establish a new fund. Following the economic downturn, there has been a significant upturn in investment in commercial property in the UK. We are delighted to have secured a number of high quality properties occupied on long term leases by blue chip tenants,’ he added.

According to Ian Williams, chairman of Campbell Dallas, chartered accountant and business advisers, this type of fund gives access to premium commercial property investment to people who may not have been in a position to access such investment before.

The HCP Commercial Property Fund is expected to complete its remaining property acquisitions by the end of June and will accept investments until this time. Investors can participate in the fund directly as a Limited Partner with a minimum investment of £25,000. SIPP and SSAS investments can also be made via a Unit Trust.