Investec and Credo acquire landmark London property

Investec Property Investments, a division of specialist bank Investec Bank Plc and Credo Property Group have announced the acquisition of 20-24 Carlton House Terrace, London SW1 for approximately £70 mln (EUR 82 mln) from Hermes Real Estate, one of the UK’s largest real estate managers. The building has been acquired by Darfield Investment Holdings Limited, a joint-venture company funded equally by the Investec GLL Special Opportunities Fund and Armstrong Management Holdings Limited (Credo).

Carlton House Terrace is a flagship headquarters building located in the heart of London’s West End in a prime St James’s location. The property contains 90,720 sq ft of Grade A offices on a 0.63 acre site, which are currently let in entirety for a further 11-year term to Anglo American Services (UK) Ltd, the UK subsidiary of Anglo American Plc. The site also includes a self-contained residential block with 14 apartments let to the City of Westminster until 2073.

Investec Property Investments is a leading real estate player in South Africa. A division of Investec Bank, the business focuses on investing into commercial property and quoted property stocks with third party funds. It has recently extended into the UK, moving a senior team from Johannesburg to Investec plc’s offices in London. The Investec GLL Global Special Opportunities Fund is jointly managed by Investec Bank Plc and GLL Real Estate Partners, the Munich headquartered global real estate fund manager with EUR 3 bn committed funds under management. The fund is euro-denominated domiciled in Luxemburg with total funds available for investment of EUR 375 mln, including EUR 150 mln in equity.

Credo is a privately owned wealth management business based in London. Its real estate division manages a commercial property portfolio in Europe and the UK in excess of £500 mln. Credo’s funds invest in direct commercial property across all sectors (office, retail, industrial and leisure). Credo currently has access to £100m equity for further investment across the UK and Europe.

Commenting on Investec’s strategy Robin Magid of Investec Property Investments said: 'The United Kingdom was an obvious place for Investec to extend its property business into. We have an established specialist banking business in London, our South African clients are seeking investment in the United Kingdom and with the recent repricing we are starting to see value in the commercial property market. This transaction is a good example of our business taking advantage of opportunities presented by the economic downturn.'

Gavin Rabinowitz, Managing Director of Credo Property Group said: 'We believe this building satisfies the fundamentals we look for, in other words a strong tenant, a great location, sensible rents and growth potential. We have substantial equity available to take advantage of the current market conditions.'