Henderson raises EUR 109m in first close of London office fund

Henderson Global Investors has announced it raised £90 mln (EUR 109 mln) of capital from a number of European and North American institutional investors in the first close of its Henderson Central London Office Fund II (CLOF II). The equity raise gives the fund up to £200 mln of spending power.

The fund has a target total equity target of £200 mln, with an ultimate fund size of around £400 mln. There is investor demand for a further close in the second half of this year, HGI said.

CLOF II is a five-year discretionary fund, which will focus on well located assets with the potential for active management and improvement. The fund's primary strategy is to acquire assets, re-position them, and sell them into an upward moving market. It has a performance target of 10% per annum IRR and a performance fee payable only on realised returns at the end of the fund's life, aligning the interests of Henderson with those of the fund's investors.

Henderson describes itself as an expert manager of central London office assets, following the success of its first Central London Office Fund (CLOF) which has outperformed its IPD benchmark since inception, and previously with the management of London assets on behalf of three major life fund clients. The central London Office team of Clive Castle, Nick Deacon and Peter Neal has over 40 years of combined experience in the market. It has been responsible for over £2 bn of central London transactions and has a strong track record of realised performance.

Commenting on the fund raise, Clive Castle, CLOF II fund manager, said: 'The central London office market offers attractive rewards for those investors who can judge their timing well and are experienced in active management. With the lack of new Grade A space coming to the market over the next few years we will soon be approaching a period of rental growth once again. We think there is a current opportunity to acquire assets in need of improvement, to conduct these improvements, and to sell into an upward moving market. We have done this successfully with CLOF and intend to do the same with CLOF II.'