UBS Asset Management's Real Estate & Private Markets (REPM) business has launched the UBS Long Income UK Property Fund (UBS-LIF property), seeded with a £90 mln (€104 mln) hotel portfolio.
The five hotel assets comprise more than 650 rooms, let to the Compass Group on 15-year lease terms.
'The stable long-term, indexed income generated by long-lease property offers an attractive alternative for investors, and at the same time, provides diversification benefits to the rest of their fixed income and property portfolios,' said Howard Meaney, head of real estate UK at REPM.
.We’re seeing a clear demand for this type of product from a broad range of clients seeking long-term, sustainable income streams, particularly those with liability matching commitments. We look forward to growing our long income portfolio as we continue to expand the fund’s investor base,' added Meaney.
The new open-ended fund targets UK long-lease assets benefitting from indexed rental increases, with a focus on alternative sectors.
The initial £90 mln of equity has been committed by a major UK local government pension plan, and REPM said it was currently in discussions with further UK and international investors, while reviewing a pipeline of investment opportunities.
