AustralianSuper through its partnership with TH Real Estate has made its first UK commercial real estate debt investment by jointly financing a £280m (€314.7m) Central London mixed-use scheme.
The AUD140bn (€86.17bn) Australian pension fund said it has committed £230m to finance the One Crown Place project being developed by Malaysian conglomerate MTD Group. TH Real Estate’s recently launched Global Real Estate Debt Partners - Fund II (UK) (GREDP Fund II) is participating with a £50m commitment.
The 370,500sqft mixed-use scheme, comprises 136,000sqft of office space, 7,000sqft of retail, a 41-bed boutique hotel and 246 luxury residential units. CBRE is acting as development manager on behalf of the Malaysian conglomerate MTD.
In Match this year, AustralianSuper expanded its relationship with TH Real Estate by hiring the investment manager to advise on opportunities in the office and retail sector in Europe.
AustralianSuper first appointed TH Real Estate in 2013. TH Real Estate helped the fund grow its UK property investment portfolio by advising on the acquisition of a 50% interest in thecentre:mk in Milton Keynes and a 67% stake in King’s Cross, London.
As part of its global core strategy, Australia’s largest superannuation fund, targets European office and retail property in the prime and super-prime sector. It currently manages a property portfolio of around A$10bn.
Jason Peasley, the head of mid risk at AustralianSuper, said: “The One Crown Place transaction strongly aligns with our real estate debt strategy to target high-quality opportunities secured against institutional assets in top-tier locations in European cities.
“Expanding our relationship with TH Real Estate – which has an impressive track record in the European debt sector – allows us to partner with a market leading global manager to access high-quality real estate opportunities.”
AustralianSuper’s commercial real estate debt mandate targets debt financing opportunities in London and other major European cities with a focus on both mezzanine and development/refurbishment opportunities for investments in excess of £100m.
Shawn Kaufman, director at TH Real Estate, said: “We are pleased to be at the forefront of the market in providing CBRE and their client with a single financing solution for the One Crown Place development and believe this transaction demonstrates the combined strength of TH Real Estate and AustralianSuper.
“As part of the now formalised debt mandate, together we are able to implement an investment strategy that is both meaningful and relevant to borrowers in the current environment.”
TH Real Estate has $3.3bn (€2.83bn) of commercial real estate debt-related assets under management in Europe.
In 2014, TH Real Estate launched the £300m Global Real Estate Debt Partners - Fund I (UK) strategy, which was followed up by the £500m GREDP Fund II with a number of separate accounts managed on behalf of various other third-party investors.
Henry Robinson, a senior director, at CBRE Development, said: “We are delighted to be working in partnership with AustralianSuper and TH Real Estate for the financing of our flagship development at One Crown Place.
“The transaction was executed efficiently and knowledgeably by the lenders from start to finish and having the CBRE debt team advise on the funding terms provided us with the necessary flexibility for the requirements of our client.”
Tee Kim Siew, the CEO of MTD Group said: “We are very pleased with the outcome of this transaction and the efficient and successful collaboration between multiple stakeholders across the globe.
“This is a great milestone for us and we are extremely proud of our team that delivered this result to build relationships with our new partners TH Real Estate and AustralianSuper.”