Barings picks up €289m UK mandate from Phoenix Group

In partnership with Phoenix, Barings will build a portfolio of investment grade buy and hold UK commercial mortgage loan assets across a range of commercial property sectors, including industrial, residential and offices diversified across Greater London and regional locations.

The facilities will have a term of between five and 50 years and Phoenix will look to match the cashflows and duration of the assets against the profile of its annuity liabilities.

Barings has already agreed its first deal for the new mandate, a £30 mln first mortgage loan on a 30 year term secured against a mixed used office and retail property on Tottenham Court Road, London, with a loan to value below 50%.

Sam Mellor, head of real estate debt – Europe & Asia-Pacific at Barings, commented: 'We are extremely pleased to be partnering with Phoenix as they build their exposure to this asset class.

'The insurance market is strategically important to our business and we have a long history of managing capital for insurers, with Phoenix’s focus on customer outcomes and sustainability aligning closely with our own priorities.

'The Phoenix mandate also aligns with our wider UK debt strategy targeting loan sizes of between £30 mln and £200 mln and diversified across the UK geographically and by asset class.

As the banks retrench from the UK lending market, we continue to see a healthy pipeline of opportunities.'

James Mitchell, head of manager oversight at Phoenix Group, added: 'We are delighted to establish this partnership with Barings with the first deal for this UK real estate debt mandate.

'The Barings team’s experience and expertise in this asset class were clearly differentiated during our selection process and we are looking forward to working with the team to help facilitate our growing needs in this asset class.'