Glanmore Property Fund is exploring ways of raising capital to avoid breaching its loan covenants. Glanmore is a £977 mln (EUR 1.1 bn) investment vehicle established in 1997 to give private investors and pension funds exposure to the UK commercial property market.
Glanmore Property Fund is exploring ways of raising capital to avoid breaching its loan covenants. Glanmore is a £977 mln (EUR 1.1 bn) investment vehicle established in 1997 to give private investors and pension funds exposure to the UK commercial property market.
In a short statement last Friday, the Dublin-listed fund said: 'The company wishes to announce that, in light of the continuing economic circumstances adversely affecting the performance of the company, the board of directors is in discussions on plans to raise further capital for the company. The company has been holding discussions with a number of parties including its lenders and is considering a number of proposals.'
Glanmore is managed by Tilney Asset Management International and has equity of £272.9 mln. Since its inception, the fund has achieved a compound annual return of 2.27%. The performance in the last few years has been disappointing: -51.55% in the last 12 months and -49.30% in the last two years, according to figures from fund information firm Lipper.
Glanmore announced in December last year that it was extending a freeze on redemptions for a further six-month period to end-June this year. 'The UK commercial property market remains in paralysis, due mainly to the continuing lack of liquidity in debt markets,' fund chairman Robert Court said at the time. 'This makes it extremely difficult to dispose of properties at anything other than "forced sale value" which our board judge not to be in the best interests of shareholders. As a result, liquidity within the fund and, in particular, liquidity to be able to meet redemption requests, continues to be an issue.'
Despite the state of the investment market, Glanmore offered 13 properties for sale at auctions in February. The properties include five bank premises and eight Iceland stores. 'Reserves have been set and some bids have already been received ahead of the January valuation figures. We anticipate some good results to report next month,' Glanmore said.
