Hermes Investment Management has relaunched its real estate debt fund to widen the opportunity set.
“The Hermes Real Estate Senior Debt fund will continue to focus on well-structured private loans on UK domiciled commercial real estate, but is widening its target investment opportunities to include all property asset classes across the breadth of the UK.
“The previous fund focused exclusively on retail, industrial and offices in London and the South East. The fund will continue to seek value for investors using a combination of excellent debt structuring skills combined with integrated real estate knowledge,” the company said.
The relaunch comes as the fund announces its first three real estate debt deals, all completed under the original fund criteria, including loans on two retail assets in the south east and a primary town centre retail asset in the south west. The deals reflect LTV ratios of around 60% – 65%, with loans over a period of three to six years.
The properties include a pedestrianised shopping precinct with a diverse income base including retail, food & beverage and leisure in an affluent Kent town; a 200,000 sq ft shopping centre in a south east town set to benefit from a new Crossrail station in 2018 and an 118,000 sq ft primary town centre scheme in the south west.
Chris Taylor, head of Private Markets and Chief Executive of Real Estate, Hermes Investment Management, said: “Real estate debt continues to provide good relative value as an investment class and our revitalised fund puts Hermes in an ideal position to take advantage of developing opportunities across the UK.