Real Estate Group

Investment

Evans Randall originates, arranges finance, underwrites and invests in real estate investments in the UK and Western Europe.

Either prior to or immediatley following completion of an acquisition, our team sources equity contributions for the investments from co-investors and pro-actively manages these investments to gain maximum value for ourselves and our co-investors.

We target prime investment assets let on long leases to very strong covenant tenants, with fixed or indexed rental uplifts. These assets offer secure income streams and good capital growth prospects for investors.

Through careful financial engineering, the group creates tax efficient structures to maximise asset values and returns for investors.

In conjunction with our real estate advisers, CB Richard Ellis, we determine the optimal time at which to maximise value from a transaction.

Tenants within our portfolio include (or have included) 3M, ABN AMRO, Rolls-Royce, B&Q, the Financial Services Authority, ING, St James's Place Capital, HBOS, the UK Government, Cisco Systems, Man Group Plc, De Brauw Blackstone Westbroek, Swiss Re, Coutts & Co, Deutsche Telekom, Credit Suisse, Bank of America, the European Commission, Commerzbank and Morgan Lewis.

Tenants include both AAA rated government organisations and highly rated financial institutions. The average minimum lease term of the group’s portfolio exceeds 20 years.

Our portfolio currently comprises around £5 billion (US$10 billion) of commercial property and we anticipate that it will have grown to £5.5 billion (US$11 billion) by the end of 2009. We plan to add at least £1 billion of further investments year on year.

Over the last three years the financing team has completed a total of US$5 billion of financing including mezzanine and preferred equity financings for projects in the UK and Western Europe. The team enjoys an excellent reputation and has consistently been able to achieve IRR’s of between 15% and 16% for investors and co-investors.

In the current market where banks are only willing to provide 65% to 70% of loans relative to value (LTV) Evans Randall will, for the right projects, be willing to provide the mezzanine layer between Senior Debt and Equity in the space 70% to 85% loans to value.

Our market focus will continue to be commercial real estate in the UK and Western Europe (with particular emphasis on Germany) where we see an ongoing requirement for this type of product. Because values have fallen in the last twelve months we believe that this has substantially de-risked this form of investment where there is a cushion of between 15% and 25% of the value of the asset is equity below the mezzanine layer.