Cordea Savills has launched a £800m property ventures fund to target non-traditional areas of the property market.
UK Property Ventures No. 1 Fund will look to invest in three main areas; the acquisition of land which can then be converted to uses with higher value; developments in sectors such as nursing homes, social housing or mixed-use; and value enhancement, such as the long-term piecing together of large development sites or acquisition of partly let buildings.
The fund is being seeded with a portfolio of 16 sites which extend to over 7,600 acres of land in the Thames Gateway that is either allocated for development by local authorities or unallocated with potential for development.
The fund will look to raise £200m in equity, and a maximum gearing level of 75% will raise the total to up to £800m.
It is targeting a return of 20% a year. It has a planned life-span of seven years, with an option to extend the fund for one year on two occasions if necessary.
George Tindley, director at Cordea Savills, said: ‘This is the right time to be raising money into a very interesting opportunity-led market.
‘In the face of much more challenging market conditions, UK Property Ventures No.1 is targeting very specific areas of the market which are less understood and therefore less competitive.’