Cabot Properties launches debut UK industrial real estate fund

Cabot Properties has launched its first fund focused exclusively on the UK, according to an investor.

The industrial real estate specialist is seeking to raise £200m (€233m) for Cabot UK Core-Plus Industrial Fund, according to a board meeting report from the Pennsylvania Public School Employees’ Retirement System (PSERS).

Pennsylvania PSERS plans to provide £50m.

Cabot, which is best known for investing in US industrial markets, has invested in the UK before but this is the first time it has launched a dedicated fund for the market.

According to the board meeting report, prepared by investment consultant Hamilton Lane, a final close is expected in June.

Pennsylvania PSERS is anticipating opportunities arising in the UK arising due to the proliferation of distribution channels related to online retailing.

The fund will seek a net internal rate of return of between 8% and 10% with a distributable yield of 4% to 5%, using leverage of up to 50%.

Pennsylvania PSERS also approved a $100m (€88.5m) commitment to another industrial fund, Exeter Industrial Core Fund III.

The target capital raise for the fund is $750m and a final close is expected by May.

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