The Queen’s speech with Norges cures stuttering Regent St

The UK Crown Estate, which as the name suggests manages the assets and estate of the Crown, has entered into the second joint venture with an institutional investor in as many months. Norges Bank, which manages the 2,908 billion kroner ($498 billion) Norwegian Government Pension Fund Global, has purchased a 150-year lease on a 25 per cent stake in the Estate’s Regent Street properties. This follows a deal in December with the Healthcare of Ontario Pension Plan.

It is the first real estate investment for the Norwegian sovereign wealth fund, which received a mandate in March last year to invest as much as 5 per cent of its assets in real estate. This investment cost the fund £452 million ($721 million).

The partnership will give the fund 25 per cent of the properties’ net income, which primarily comes from office and retail space rent. The Crown Estate will retain 75 per cent of the income and will continue to be responsible for the management of the portfolio.

“We’re very happy to have signed an agreement and look forward to a long and beneficial partnership with The Crown Estate,” global head of real estate asset strategies at Norges Bank Investment Management, Karsten Kallevig, said.

David Shaw, head of Regent Street at The Crown Estate said: “We are delighted that one of the world’s largest sovereign wealth funds, has chosen The Crown Estate and Regent Street for its first-ever property investment. NBIM’s long-term approach fits perfectly with our ongoing commitment to regenerating Regent Street to create an international retail and business destination.”

In December the $31 billion HOOPP, which has about $5 billion in real eastate, took a 50 per cent stake in the £100 million, St James’s Gateway development, in London W1, together with the adjacent Clydesdale block. Similarly, the Crown Estate will retain the freehold for the blocks and grant the joint venture a new 150-year head lease, and it will also oversee the development and directly asset manage the properties upon completion, which is expected in 2013.

The Crown Estate dates from 1066. After the Norman Conquest, all the land belonged to William “in right of The Crown” because he was King. Despite centuries of change in law and custom, the underlying ownership of The Crown still exists and there is always a presumption in favour of The Crown unless it can be proved that the land belongs to someone else.

The Crown Estate, managing a property portfolio worth £6.6 billion, today contributes more than £210 million to the UK Treasury.

© Copyright: Whole articles from this website and newsletter cannot be reproduced without permission from the editor. If you wish to publish introductions to any article please ensure that it links to original content site, and that it shows clear attribution to, plus author name and date. Failure to abide by this request will be considered a breach of copyright and legal action will be taken.

  • Filter:
  • News

    Intelligence on up to the minute items from around the globe

  • Investor Profile

    Behind the scenes summary of large institutional investors’ investment strategy and future plans

  • In Conversation

    Candid conversation with the leading investment experts

  • Analysis

    An in-depth examination of the latest investment trends and ideas

  • Insider

    An editorial perspective on what affects the people and processes in this industry

  • Research

    Cutting edge academic and practitioner insight

PGGM halves CO2 footprint in investments

Ahead of the COP21 in Paris, the second largest Dutch fund with €161 billion ($160 ... [more]

Mercer’s seven tools for risk management reflect evolving landscape

Mercer Investments is using its deep insurance and environmental, social and governance (ESG) skills, contacts ... [more]

OTPP advises on climate risk mitigation

Ontario Teachers’ Pension Plan (OTPP), an investor known for its advanced risk-management tools and processes, ... [more]

PRI to consider new principle focusing on systemic risks

The UN-backed Principles for Responsible Investment (PRI) is considering a seventh principle that will focus on ... [more]

Redefining indexes to reflect reality

The investment industry should be constantly looking at the impact of technology on the status ... [more]

The Future Fund 2.0

With its 10th birthday looming, the Future Fund is entering its next incarnation complete with ... [more]

Understanding the cost of investment management

Across the institutional investment community, disclosure and transparency of costs continues to be evolving, but ... [more]

Empowering asset owners

Head of the global union movement, Sharan Burrow, has called on asset owners to “stop ... [more]

Why investors should de-carbonise

Regardless of moral and scientific arguments, the “risk of policy action” on climate change is ... [more]