In 2009, British Land retail boss Andrew Jones walked out with two colleagues to set up LondonMetric.
In 2024, the 55-year-old is likely to preside over an empire of almost equal stock market value to BL. Provided, that is, shareholders of LXi REIT agree to merger terms to be announced this week. Shares in the combined firm will be worth £3.6bn, against BL’s £3.7bn market capitalisation. Quite a feat.
LXi holds £3.4bn of mainly long-leased assets, most accumulated by Nick Leslau, who supports the all-share offer. The 64-year-old merged his Secure Income REIT with LXi in May 2022. LondonMetric holds £3bn of assets picked up by Jones in a series of deals, one being the £415m Mucklow buy in 2019.
The plan? Do an outsized Mucklow and bring the management in-house. LXi is run by Alvarium Fund Managers, inevitably empire minders rather than builders. The economies of scale of tending twice as much stock are self-evident.
Then there is the sale of those pieces of the new jigsaw that don’t fit. In 2023, £700m was cut from the combined book values, now standing at £6.4bn. LXi holds hundreds of pieces that don’t fit, which will be slowly put up for sale, if or when values rise.
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