The principals behind UK-based Osprey Equity Partners and privately-held multi-family office LJ Group have unveiled plans to launch a new closed-ended fund LXi REIT, focusing on assets with ultra-long leases across the UK.
LXi REIT, which said it had already identified a substantial pipeline of properties, is targeting commercial, residential and alternative assets distinguished by very long index-linked leases of 20-30 years and institutional grade tenants. A £200 mln (€235 mln) flotation is planned for early February.
The REIT said it would consider a wide range of sectors, including office, retail, leisure, industrial and distribution as well as hotels, serviced apartments, affordable housing and student accommodation. It will also focus on growth sub-sector areas such as discount retailers, budget hotel operators and 'last mile' distribution units fuelled by online retail.
While the initial plan is for the issuance of £200 mln shares, a placing programme will permit the issue of another £200 mln over the next 12 months.
LXi REIT is seeking admission to the premium segment of the London Stock Exchange's main market.
Its investment advisor, LXI REIT Advisors, is owned by the principals behind Osprey Equity Partners (part of LJ Partnership, which has $4.5 bn or €4.1 bn of real estate assets under management). Osprey Equity Partners has executed 21 transactions in the last four years, with a gross asset value of approximately £700 mln, nearly all with very long-term leases and a similar asset profile to the properties LXi is targeting.
Peel Hunt LLP is acting as sole sponsor, broker, placing agent and intermediaries' offer adviser to the company.
