Newcore Capital Management has launched Newcore Strategic Situations III, a £50 million ($63 million) opportunistic fund that will invest in U.K. real estate assets linked to social infrastructure, storage and accommodation.
Newcore has secured equity commitments for the fund from a number of family offices.
Newcore’s investment strategy focuses on assets it considers to be central to the continuing needs of society and resilient to the Internet’s deflationary effect.
Within the social infrastructure, storage and accommodation sectors, Newcore will, on behalf of the fund, target strategic situations, which will include planning plays and refurbishment opportunities, and may also include development. The fund will aim to deliver a 14 percent to 16 percent internal rate of return and a 1.5 times equity multiple.
Newcore has already completed its first two acquisitions for the fund, Manor House Care Home, a 76-bed, 46,000-square-foot care home located on a 3.7-acre site in Merton near Bicester, Oxfordshire, and a three-acre development site near Sutton, south west London, for a combined £3.6 million ($4.5 million).
Newcore Strategic Situations III continues the value-add and opportunistic strategy Newcore has executed since 2012.
Its first fund, Newcore Strategic Situations I, delivered a total unleveraged return of 15 percent in 2016 and total unleveraged returns of more than 20 percent per year since inception in June 2013.
Its second fund, Newcore Strategic Situations II, delivered a total unleveraged return of 18 percent in 2016, its first full year, driven by planning wins at Sutton and Blackheath and leasing gains across its portfolio.