In addition to its co-mingled fund range, Principal Real Estate Europe manages a number of segregated accounts, where clients generally have specific investment criteria or wish to invest in larger portfolios on a standalone basis.
Our approach to segregated accounts always begins with the client. By understanding a client’s risk appetite, tax position, approach to leverage and return requirements, we are able to consider the role any investment may play within a client’s portfolio and advise them accordingly.
Once the criteria are set, a strategy is agreed and investments sourced by our pan-European transaction teams. Completed acquisitions are transferred to our specialist asset managers and the portfolio is overseen by an investment manager.
Every key investment decision is subject to the scrutiny of our Investment Committee to ensure best advice to each client, although with segregated accounts, the client may retain control or veto of the transaction decisions.
|French Retail Fund Client (1)||Exclusive mandate to acquire and manage a first portfolio of core+ German retail assets on behalf of a French SCPI retail fund manager - now fully invested.||62 German retail assets||€585m|
|French Retail Fund Client (1)||Follow-on mandate to acquire and manage a second portfolio of core+ German retail assets on behalf of a French SCPI retail fund manager.||Portfolio being assembled with a number of assets acquired to date and a strong pipeline.||€60m|
|French Retail Fund Client (2)||To manage a portfolio of core/core+ office assets in Europe.||Acquired three individual assets in the Netherlands and Italy and a portfolio of German office assets to date, with a pipeline identified for further acquisitions.||£245m|
|UK Corporate Pension Fund||Strategy focused on cyclical resilience, designed to perform over a minimum 10-year investment horizon, with a preference for secure income returns and core locations.||Two large assets acquired, with a further pipleline portfolio under development.||£123m|
|Brazilian Family Office||To provide investment and asset management services in core/core+ retail, office and logistics assets.||Acquired and managing two Spanish shopping centres to date.||£132m|
|Sharia Compliant Fund||To invest in core and core+ long lease assets across Europe with active asset management opportunities and with a target IRR of 7.5 - 9% and an income return of 6-7%.||First acquistion secured in Paris in an OCPI structure with a further pipeline portfolio under development.||£83m|
|German Pension Fund||Segregated account, structured as a German regulated Spezialfond, to invest in core office assets in the Cologne region wth secure long-term income streams and limited risk of capital loss.||Targeting to invest €100 million, with three assets acquired to date and a strong investment pipeline.||£27m|
|Global Investment Management Client||To manage a high-quality portfolio of core+ and value add pan-European logistics assets in established transport hubs.||Current portfolio comprises eight geographically diversified logistics assets.||£142m|
Giles Smith - Head of Fund Management - Biography and contact details
Head of Fund Management
Principal Real Estate Europe. A Chartered Surveyor with 14 years’ experience in fund management and corporate real estate, Giles began his career with ATIS Real Weatheralls, providing corporate real estate and consulting services for major listed companies such as London Electricity and Barclays. Giles moved on to become Real Estate Corporate Finance Manager at Deloitte & Touche, working on real estate transactions including the sale and leaseback of 41 hotels for the WA Shearings Group (£110m) and the sale of 24 hotel assets for Macdonald Hotels (in excess of £400m); as well as providing structural and strategic advice on real estate investment funds. More recently, Giles became a Fund Manager with GPT Halverton in 2008, and has been a Fund Manager with Principal Real Estate Europe since 2010, responsible for a number of real estate investment funds including HBI Netherlands, Dutch Active Fund, Benelux Industrial Partnership, German Office Fund and Alecta Netherlands.
Phone: +44 (0)20 7355 8800
Principal Real Estate Limited
Phone: +44 (0)20 7355 8800
Risks of Investing in Real Estate Assets:
No assurance can be given that returns will be generated which are commensurate with the risks of investing in the type of investments to be made. Investments in real estate assets are subject to a range of risks that could cause such investments to lose value. These investments are speculative in nature and the possibility of a loss of the entire amount invested exists. The possibility of partial or total loss of investment will exist, and prospective investors should not proceed unless they can bear the consequences of such loss.
Economic and regulatory changes that impact the real estate market generally may cause operating results to suffer and decrease the value of investments. Real estate investments will be subject to the risks incident to the ownership and operation of property, including but not limited to any or all of the following: the general economic climate, actual or perceived property values, local property conditions (including the availability of properties relative to demand), vacancies, adverse use of neighbouring real estate, credit risk arising from the financial condition of tenants, buyers, and sellers of properties, geographic or market concentration, inability to obtain any required permits, consents or entitlements for a reasonable cost or on reasonable conditions or within a reasonable timeframe; facts relating to the condition of the property not discovered by due diligence, competition from other areas, government regulations or policies (such as changes in regulations governing land usage, improvements and environmental issues), liability arising out of the presence of certain construction materials, uninsurable losses, any need to defend title, the need to advance capital to protect an investment, fluctuations in interest rates and the risk that the cost of owning real estate may exceed the income produced.
Property has historically experienced fluctuations and cycles in value, and local market conditions may result in reductions in the value of real property and difficulty in assessing value. The marketability and value of real property will depend on many factors, including changes in general or local economic conditions; changes in supply of, or demand for, competing properties in an area; changes in interest rate; the availability of mortgages and related finance; the promulgation and enforcement of governmental regulations relating to land-use; issues relating to environmental protection and occupation safety; which may render the sale of a property difficult; the financial condition of tenants, buyers; changes in land tax rates and operating expenses; and energy and supply shortages.
Real estate investments are generally illiquid and there may be little recognisable market for sale of those investments or by reference to which they can be valued. Further, in light of the illiquidity of the investment, it may be difficult to dispose of the investment at a price similar to the acquisition price. Returns will also be reliant on the skill and judgement of agents and consultants to value and advise on the terms of real estate transactions relating to the investments such as lease negotiations.
Concentration in any one region may arise from time to time. For example, at any given time, certain geographic areas may provide more attractive investment opportunities than others and, as a result, an investor’s portfolio may be concentrated in those areas. The risk that payments on investments could be adversely affected by defaults or the general deterioration of underlying assets is likely to be increased to the extent that the portfolio is concentrated in such a way which, consequently, could have an adverse impact on the value of the investments.
Due diligence on properties may not reveal all conditions that may decrease the value of an investment. Not all circumstances affecting the value of an investment can be ascertained through the due diligence process. If the materials provided are inaccurate, if the sufficient investigations are not made, or if the due diligence process fails to detect material facts that impact the value determination, an investment may be acquired that results in significant losses.