Feldberg Capital has completed the first transaction for its new ReForm Fund, with the purchase of 8 Bloomsbury Street in London from an institutional investor.
The ReForm fund aims to transform brown office buildings into workplaces with green credentials. The fund is targeting well-connected, amenity-rich central London growth locations such as Soho, Fitzrovia, Marylebone and Bloomsbury, Feldberg people said.
The fund received significant backing from a cornerstone UK institutional investor, achieving first close in October of this year. The fund has a target of £300m, which Feldberg insiders said “will provide firepower of around £500m including leverage”.
The newly purchased 8 Bloomsbury Street was refurbished in 2017 and will receive further retrofitting, in line with Feldberg’s ESG goals, to provide tenants with bespoke, fully-fitted, green workplace across 33,448sqft.
Feldberg’s office experts say the office sector is undergoing ”a significant structural shift with a growing division between healthy, tech-enabled, green workplace assets and older, less energy-efficient offices”. They added that this, in addition to the challenging macro-economic climate, has created an attractive buying opportunity for Feldberg to apply its brown-to-green asset management expertise, and deliver stock into a market experiencing a scarcity of green ESG-focused workplace assets accompanied by growing occupier demand.
Robert Allen-Mersh, director at Feldberg Capital, said: “We are seeing a once-in-a-generation opportunity to invest in some of Central London’s best commercial real estate assets at very attractive values. This transaction demonstrates our ability to source opportunities of the highest quality in a tough market. 8 Bloomsbury Street is a high-quality building in an excellent location a short walk from Tottenham Court Road underground station, but requires significant ESG improvement works to create a best-in-class green workplace asset.
“This is an excellent first acquisition for the fund as we look to assemble a unique Central London portfolio with an attractive pipeline,” he added.
David Turner, managing partner at Feldberg Capital, said: ‘The London office market provides one of the most attractive risk adjusted investment opportunities in Europe. Rarely does such value exist in a global gateway city, but the window may close quickly as interest rates fall.”
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