Legal & General partnership typifies confidence in London Real Estate
It has been a busy few days and an even busier month for Legal & General (L&G). Earlier this week the financial services giant announced a £1.5 billion allocation to a £15 billion regeneration fund for cities announced at the Downing Street Investing in Cities event earlier this week. The fund, which L&G will manage, is due to focus on regeneration projects in urban areas, particularly in Birmingham, Bristol and Leeds.
Another announcement came yesterday, that L&G will partner with Dutch pension fund manager PGGM, in the development of a London office space worth £375 million. Both partners have already invested together in London by purchasing National Magazine House in Soho for £67 million and earlier in January. L&G and PGGM also announced that it had purchased Bishops Gate Long Term Property Fund Unit Trust for £370 million.
Yesterday’s announcement of further partnership with PGGM, allows L&G to use their expertise and experience as well as local knowledge to focus on maximising the value of office space developments while facilitating significant investment from foreign capital seeking to take advantage of the stability of the London real estate market.
Laura Mason, director of direct investments at Legal & General Capital, said: “The UK is a great place to invest, pension funds and sovereign wealth funds want to invest here in infrastructure, direct investments and property.
“Joint ventures are an excellent way of achieving this, as they offer co-investment with a trusted partner with specialist local expertise and knowledge.”
Given the extent to which both companies are increasing their portfolio of properties around the UK, it is another sign that the partnership between L&G and PGGM is one with a medium to long term strategic plan and is yet another example that significant foreign investment in UK real estate assets is set to continue and even increase in 2015.