Harbert fund buys five Segro assets for EUR 353m

Alabama-headquartered investor Harbert Management Corporation has announced the acquisition of five real estate assets from UK REIT Segro for £284 mln (EUR 353 mln).

Together with institutional investors, affiliates of Harbert European Real Estate Fund III acquired the office park IQ Farnborough and four multi-let industrial estates in the UK. The assets were part of a disposal programme initiated by Segro towards the end of 2011.

IQ Farnborough was originally acquired by Segro from the UK Ministry of Defence in 1999 and has been developed as a Class A office park. It consists of around 42,000 m² of existing space across nine buildings with building rights for an additional 60,000 m².

Harbert said the property was acquired in May for £79.75 mln or £177 per square foot (0.092 m2) of existing space. The buildings are well occupied across a number of tenants. Fluor, the largest tenant, relocated its EMEA headquarters to the property in 2010 and occupies four buildings, one of which was sold on a long leasehold.

The four multi-let industrial estates acquired are Trafford Park and Heywood Distribution Park in Manchester and Kings Norton Business Centre and Meteor Park in Birmingham. The portfolio consists of approximately 404,000 m² of existing space plus an additional 25 hectares of developable land. The properties were acquired in June for £204.5 mln.

Scott O’Donnell, senior managing director of HMC Europe, said the acquisitions represent the company's second and third transactions with Segro and fit nicely with its existing portfolio. 'Both acquisitions are defensive in nature with strong in-place cashflow yet have significant upside potential. We are pleased that in today’s challenging economic environment we have been able to source attractive investment opportunities and secure financing for them,' he said.

Harbert was advised by Wragge & Co on the legal aspects of both transactions. On the property side, Harbert was advised by Drivers Jonas Deloitte, DTRE and XLB for IQ Farnborough and B8, DTRE and Canmoor on the industrial portfolio.

Harbert Management Corporation, which sponsors the Harbert European Real Estate Funds, is an alternative asset investment management firm that manages 10 investment strategies. The European real estate investment team has offices in London, Paris and Madrid.