12 Jul 2013

Starwood Capital Group and M7 Real Estate Launch Joint Venture Focused On the UK Industrial Market

12th July 2013 – An affiliate of Starwood Capital Group, a leading private investment firm, and M7 Real Estate LLP, the specialist industrial asset manager, announced today they have launched a new joint venture to invest in the UK Multi Let light industrial market.

The joint venture, called MStar, has a total capacity to invest approximately £100 million, including debt. MStar has already completed its debut purchases, acquiring 13 estates from nine vendors for a total consideration of approximately £25 million.

The acquired portfolio provides 1.15m sq ft in 147 units. The initial yield is approximately 10% with a reversionary yield of 13%.

Adam Shah of Starwood Capital said, “We are pleased to have created this joint venture with M7. We are of the opinion that the fundamentals of the Industrial real estate market in the UK provide the opportunity to produce a strong cash flow from the portfolio with the prospect of medium-term growth.”

David Ebbrell, head of transactions at M7 Real Estate added, “The portfolio that we have acquired provides a number of short term asset management opportunities to improve income stream whilst benefitting from the substantial risk diversification that this asset class affords.”

The joint venture has a number of other assets under offer and is expected to be fully invested by the end of the year.