M&G has acquired a 65% stake in value-add real estate fund manager BauMont Real Estate Capital for an undisclosed sum.
BauMont, which has €1.5bn of assets under management will join forces with M&G Real Estate’s £40bn global real estate business, enabling M&G to expand its client proposition beyond its established core commercial, residential and debt strategies – and the ability to invest throughout the full property cycle.
In turn, BauMont will benefit from M&G’s significant pan-European real estate platform, alongside its global distribution capabilities that have been expanded to meet the growing needs of institutional investors in Europe and Asia.
Separately, M&G’s With-Profits Fund – which invests and manages the long-term savings on behalf of 4.6 million UK policyholders – is investing €200m in BauMont’s latest fund to secure higher returning opportunities in European value-add property in the UK and France for its wider £13bn real estate allocation.
Tony Brown, global head of M&G Real Estate, said: “This new partnership is an opportunity to broaden the real estate strategies we offer at a time when the asset class is back in focus for global institutional clients who are considering increasing their allocations at this stage in the cycle.
“Throughout our extensive history of real estate investing, we have continued to strive for excellence and can now provide clients with a compelling proposition throughout the real estate cycle - and across the capital stack. We look forward to a long and successful partnership with BauMont.”
Robert Balick, managing partner at BauMont, added: “European real estate markets are adjusting to the higher rate environment and are entering a new cycle of growth where demand is focused on a limited supply of high-quality assets. Value-add strategies can take advantage of re-set entry pricing, whilst actively repositioning assetsto meet the needs of modern occupiers.
“We are delighted that M&G is becoming a majority shareholder in our business and we look forward to unlocking the significant growth opportunities that this strategic partnership will create to deliver enhanced value to our investors.”
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