UK - The £7.8bn (€11.6bn) West Midlands Metropolitan Pension Fund has awarded ING Real Estate a £560m advisory mandate to manage its UK direct property portfolio.
The deal – one of UK’s largest pension fund property mandates – involves advisory services on the acquisition and divestment of the scheme’s direct property portfolio.
The pension fund’s property portfolio - 7.1% of its total assets - is invested mainly in directly-owned assets within the retail sector (35%), offices (36.3%), industrial (19.5%) and agricultural (0.8%).
The fund also holds a small proportion of indirect investment in the form of a unit trust, to provide exposure to the overseas property market, the scheme said.
West Midlands Metropolitan’s property portfolio, which comprises of 50 objects, makes up approximately 8% of its total investment portfolio and returned 20.5% last year.
"We were very impressed by ING Real Estate’s portfolio modelling strategy, and believe they are in the best position to deliver the fund’s performance objectives," Judy Saunders, CIO of the scheme, said.
The pension fund is currently advised by John Fender Consultancy and surveyor’s firm Cushman & Wakefield Investors but ING said it will fully take over the advisory services as of 1 January 2008, after a transitional period.
West Midlands’ Metropolitan Pension Fund has 219,000 participants, of whom 104,400 are active workers, and provides the pensions for 190 employers.
ING Real Estate is an international real estate company, active in investment management, development and finance, with a total business portfolio of €90bn and offices in 21 countries.
At the same time as winning the West Midlands mandate, ING Real Estate has also acquired the Imagina TV Building in Barcelona for its Europe Office Fund, for €57m.
The building has six-floor and comprises of 20,000 m2 office space, along with 432 parking spaces.
"Imagina is a sound cash-flow investment, that is secured with long term leases," fund manager Leo Weidenaar commented. He pointed to planned value-enhancing developments for the area in the near future.