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LaSalle raises £264m for third U.K. residential finance fund

by Released

LaSalle Investment Management has raised £264 million ($342 million) for its third U.K. residential finance fund.

LaSalle Residential Finance III will focus on assets being developed or redeveloped for use as student housing, residential accommodation, hotels or healthcare-related property.

The vehicle is providing whole loans for larger and/or more highly leveraged developments at loan-to-cost ratios of up to 80 percent, with loans ranging from £15 million to £100 million ($19 million to $130 million).

The fund series has raised £704 million ($912 million), collectively.

LRF I and II have invested nearly £500 million ($648 million) since 2013, including a £110 million ($143 million) whole loan to Telford Homes and Business Design Center during the third quarter 2016 to fund the City North development, a 355-unit residential-led mixed-use scheme in Finsbury Park.  The new LRF III commitment will enable LRF to further grow its position as a market leader in development finance.

Additionally, LaSalle’s most recently launched fund in its debt series, LaSalle Real Estate Debt Strategies III, has secured aggregate commitments of £334 million ($432 million) to date and is well on track to exceed the £600m raised for the prior fund. The fund’s primary geographical focus is the United Kingdom but it also invests across Western Europe and the Nordics. The fund strategy is to focus on lending against quality assets with best-in-class sponsors; the combination of which offers compelling risk-adjusted returns across mezzanine and whole loan investment opportunities.

LREDS III has already extended a £38 million ($49 million), five-year mezzanine facility to finance the acquisition of a U.K. portfolio with an aggregate purchase price of £191 million ($248 million), sponsored by clients of BMO Real Estate Partners. The portfolio is composed of three assets encompassing 853,000 square feet of real estate, including a department store in the city center of Manchester and two retail parks: Clifton Moor Retail Park in York, anchored by Tesco, and Westgate Retail Park in Wakefield. The trio of assets is located in strong U.K. submarkets and provides high-quality, long-term income.

 

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