M&G Real Estate has said it carried out some £3.8 bn (€4.9 bn) of property acquisitions and sales during 2014.

M&G Real Estate has said it carried out some £3.8 bn (€4.9 bn) of property acquisitions and sales during 2014.

The investor, part of London-based insurance group Prudential's investment arm M&G, reported total transactions of £7.3 bn (€9.3 bn) over the past two years, of which more than £5.7 bn was acquisitions.

ALTERNATIVE ROUTE
During 2014, more than £3.2 bn of property assets, with an average deal size of £50 mln, were acquired or committed to - around two thirds of which were achieved off-market. In the same period, M&G Real Estate disposed of 73 holdings to realise more than £590 mln in cash. M&G rounds off the total reported volume of more than £3.79 bn to around £4 bn.

With a more marked focus on key office and logistics markets in southeast England, M&G Real Estate has made £164.5 mln of purchases in Reading and invested £33 mln in Watford in a total of five separate transactions, alongside strategic acquisitions in non-core London locations such as Aldgate and Park Royal. This focus on major business hubs in and around London is a response to improvements in the economy and a resuming office development pipeline.

The global real estate fund manager has also increased its exposure to alternative property with the purchase of a portfolio of six acute psychiatric hospitals for £223 mln in October and a portfolio of 39 health clubs for £92 mln in February.

BIGGEST DEALS
M&G Real Estate's five biggest deals of the year include 1 Spinningfields Square in Manchester (£320 mln); Gala Bingo portfolio (£173.5 mln); Parc Trostre Retail Park in South Wales (£156 mln); 2 Snowhill, Birmingham (£146 mln) and Fremlin Walk Shopping Centre in Maidstone (£110 mln).

On the international stage M&G Real Estate has made £273 mln of investments in Australia and Japan, on behalf of its core Asia strategy, including a 42,180 m2 office and warehouse complex in New South Wales, a 23,286 m2 transport and warehouse facility outside Melbourne, 745 apartments in West Japan and a seven-storey office in Tokyo.

Alex Jeffrey, CEO of M&G Real Estate, commented: 'Over the past two years we have been one of the most active participants in the property markets as our clients have allocated more capital to the sector. We have taken advantage of improving market conditions to reposition our portfolios and add more quality, as well as diversifying into alternative sectors offering long term income potential. Capital inflows to our funds have also been strong in 2014.'

BUILD-TO-RENT
M&G Real Estate also continues to play a leading role in the return of institutional investment back into the UK's private rented residential sector. In July, for instance, it committed to fund a £43.5 mln, 152-unit private rented development in the North Acton district of west London.

'There is no doubt that 2014 has seen M&G Real Estate entering into exciting new business areas, while retaining and further growing our focus on those key markets in which we are well-established. We move into 2015 in a strong position, having made a number of significant appointments to our global team and with the benefit of growing investor and third party capital interest in our industry-leading investment strategies,' Jeffrey said.

M&G Real Estate is one of the top 25 real estate fund managers in the world by assets under management, with over £20.4 bn invested in a broad spread of properties across Europe, North America and the Asia-Pacific region at end-September 2014.

M&G Investments reported in mid-December that it had provided around £3.5 bn (€4.4 bn) in financing for real estate deals in 2014 through a combination of commercial mortgage loans, long-lease property and social housing loans.

In Europe, M&G has deployed almost £2 bn since the beginning of 2014, including a £238 mln financing for Northern Trust Group, the UK property investment, development and land regeneration company.