Grainger buys 50% stake in £285m portfolio

UK quoted residential property company Grainger has acquired Genesis Housing Group's 50% share in Grainger GenInvest Partnerships along with associated loan notes for a total of £15 mln (EUR 17 mln), financed out of existing company resources.

The transaction will make Grainger the sole owner of the portfolio. On completion of the deal, the Grainger GenInvest Partnerships secured new debt facilities of £120 mln from HSBC and Santander which enabled existing lenders to exit.

Grainger GenInvest was created in June 2005 by Grainger and Genesis in a 50±50 joint venture, and now consists of eight high-quality residential blocks in central London, consisting of 1,630 units with a market value of £285 mln. The portfolio is 'consistent with Grainger's focus on high-quality reversionary assets in areas offering prospects of capital growth', the company said. The assets currently generate a gross rent roll of approximately £12 mln.

Grainger said that the acquisition helps deliver its strategic objective to acquire portfolios of residential assets delivering good long-term returns. Furthermore, the sourcing of new debt from banks who have not previously lent to the group provides Grainger with a further opportunity to diversify its sources and type of company financing.

'This is a fantastic, high-quality portfolio, and a rare opportunity to acquire over 1,500 units the majority of which are within four miles of Westminster,' said Andrew Cunningham, Grainger's Chief Executive. 'This transaction is consistent with our strategy to acquire high-quality portfolios of residential assets which deliver good long-term returns. The fact that we already know the portfolio in-depth made this even more appealing.'

Grainger is active in the UK and Germany covering ownership, trading, fund management, property management and development of residential property.