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Fund is Close to property returns

Close Property Investment is looking to raise up to 10m for the 7th special opportunities fund, a limited partnership that is also available as an exempt unit trust

The fund aims for returns of 12-14 per cent a year by investing in a range of property development and trading projects over the next three to four years. These may include developing properties, changing the use of properties, renovation or refurbishment, land dealing and trading within a property portfolio.

Although the focus will mainly on the UK, up to 20 per cent of the money the property manager has earmarked up to 20 per cent of the fund for investment in property in mainland Europe, particularly in regions which have recently joined the European Union.

Up to 15m in bank debt may be added to finance transactions within the expected range of 1m- 20m, which the company believes is sensible given relatively low interest rates. Close Property Investment also believes the ability to make immediate cash offers will increase its purchasing power in the face of competition.

According to Close Property Investment, current and anticipated economic growth is fuelling demand for office space and the need for new housing presents opportunities to buy land where value can be added by gaining planning permission for residential or mixed use schemes.

In addition, reduction in rental yields will mean increase in capital values which could lead to sales within property portfolios which have not been actively managed, providing room to add value by restructuring leases, carrying out improvements and letting vacant space.

One potential drawback is that specific projects have not yet been identified and the company has only 12 months to invest the money raised. However, it is confident that suitable opportunities will be found within that time span.


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Managers of managers Aon Asset Management and Northern Trust claim it is cheaper for them to change managers than it is for funds of funds houses. Both companies run portfolios for retail fund management groups and employ transition managers to minimise costs and disruption to portfolios during a manager change. Fund of fund managers have […]


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