£115m City of London deal kicks off venture for the downturn

Evans Randall is to launch a £1bn opportunity fund to buy prime assets from forced sellers.

The UK investment bank’s first asset to go into the fund will be Condor House in the City of London, which it recently bought for £115m, reflecting a yield of 5.3%, as revealed by Property Week on 30 November last year.

The 110,000 sq ft office at 4-15 St Paul’s Churchyard is let to banking group Barclays Capital and law firms Morgan Lewis & Bockius, Shepherd & Wedderburn and Heller Ehrman.

The fund is designed to take advantage of difficulties in the market, as property owners seek to liquidate assets in response to redemptions by their investors, or because of other liquidity issues.

Michael Evans, chief executive of Evans Randall, said: ‘The fund puts us in an extremely strong position to take full advantage of the opportunities we will see in the market over the coming months.

‘We will target high-quality buildings, where the owners seek to liquidate their assets, before yields shift back to the levels that we have become used to.

‘This window of opportunity won’t be open for long. It was key, therefore, that our debt provider, Bank of Scotland, was able to move quickly to help establish this fund.’

Evans added: ‘For the moment, the fund will focus predominantly on the UK market, where we perceive the opportunities to be the greatest.

‘However, if we see movements across markets overseas, we will adapt accordingly.’

Evans Randall bought Condor House following a decision by LaSalle Investment Management and agent Jones Lang Lasalle to withdraw from a deal with Propinvest, which had put the office under offer last year.

Evans Randall, which was formed in 1993, is one of several investors to launch opportunity funds in the UK as the market slumps following the credit crunch that set in last summer. Property Week revealed plans by institutional investors Threadneedle and Invista Real Estate Investment Management to launch opportunity funds.

CB Richard Ellis advised Evans Randall on its acquisition of Condor House.