Hines and Universal-Investment Acquire Manchester's Royal Exchange Marking Second UK Investment for €1.3 Billion European High-Street Retail Mandate

(LONDON) – Hines, the international real estate firm, and German investment company Universal-Investment have acquired Royal Exchange in Manchester city centre from Trinistar Manchester, a joint venture between Starwood Capital Group and Trinity IM. 

The acquisition was made for an institutional real estate fund on the platform of Universal-Investment, administered and managed on behalf of Bayerische Versorgungskammer (BVK), Germany’s largest pension scheme group, with approximately €62 billion assets under management. This deal is part of its €1.3 billion investment mandate from BVK which is targeting prime high-street retail assets across Europe.

In addition to housing the 700-seat Royal Exchange theatre, the 264,000-square-foot building incorporates 81,000 square feet of retail and leisure space and 121,000 square feet of office space. The retail and leisure space is home to a range of tenants including Molton Brown, Starbucks, Swarovski, L’Occitane and Hotel Chocolat. The office space is currently being comprehensively refurbished to create highly specified modern space, of which 82,000 square feet is available to lease.

The property represents the second acquisition in the UK for the BVK European high-street retail account, following the acquisition of a prime retail asset on Glasgow’s prime shopping street earlier this year.

This transaction is the sixth acquisition by Hines and Universal-Investment for the BVK mandate which has also purchased two assets in Milan, and further prime high-street retail assets in Oslo, Glasgow and Paris.

Anthony Leonard, Managing Director, Hines UK, said: “Royal Exchange represents a rare off-market opportunity to acquire a prime mixed-use asset in an excellent location in the city centre. We look forward to working with our leasing agents Savills and Canning O’Neil to lease the remaining office space.”

Sharon Bloodworth, Director of Retail Asset Management, said: “Following the recent upgrade of the building’s façade and the extensive remodeling of the Royal Exchange Arcade, we will continue to reposition the retail space to provide a high quality and niche retail environment to compliment the wider Manchester retail offer.”

Peter Epping, Managing Director – Investment Management, Hines Europe, said:  “With its location in the heart of Manchester’s city centre, the diverse mix of retail tenants and prime office space, the iconic Royal Exchange building is well positioned to benefit from the continuing positive development of the city’s retail and office core and represents a promising long-term investment for BVK’s high-street retail strategy.”

Richard O’Boyle, Executive Director, Trinity IM said: “It has been a privilege to own and work on one of Manchester’s most iconic assets. From the outset our vision was to create high-specification office accommodation and enhanced retail offer which was respectful of the past, yet complemented Manchester’s dynamic edge. Following two years of intensive asset management, we are proud that the property is now back to its former glory. I would like to put on record our sincere thanks to Manchester’s civic team, consultants, agents and occupiers who supported us in completing this existing project”

Alexander Tannenbaum, Managing Director of Universal-Investment, adds, “German institutional investors are strongly increasing their real asset portfolios. Retail properties are an essential part of these portfolios as they deliver steady returns and provide good diversification.”

Bilfinger GVA advised Hines, MMX and Commercial Properties acted for Starwood and Trinity IM.

About Hines:

Hines is a privately owned global real estate investment firm founded in 1957 with a presence in 192 cities in 20 countries. Hines has $93.2 billion of assets under management, including $47.9 billion for which Hines provides fiduciary investment management services, and $45.3 billion for which Hines provides third-party property-level services. The firm has 105 developments currently underway around the world. Historically, Hines has developed, redeveloped or acquired 1,180 properties, totaling over 379 million square feet. The firm’s current property and asset management portfolio includes 483 properties, representing over 199 million square feet. With extensive experience in investments across the risk spectrum and all property types, and a pioneering commitment to sustainability, Hines is one of the largest and most-respected real estate organizations in the world. Visit www.hines.com for more information.

About Bayerische Versorgungskammer:

Bayerische Versorgungskammer is the competence and service centre for occupational and communal pension schemes and Germany´s largest pension scheme group under public law. It is the joint executive body of twelve liberal professions´ and communal pension schemes. Bayerische Versorgungskammer covers about 2 million insured persons in total, with contributions of €4 billion and €2.9 billion pension payments annually. It currently has €62 billion assets under management and 1,200 employees. Visit www.versorgungskammer.de for more information.

About Universal-Investment:

Universal-Investment is the largest independent investment company in German-spoken Europe with fund assets in excess of about EUR 260 billion under administration, thereof EUR 220 billion in own vehicles, over 1,000 funds and investment mandates and a workforce of around 600. The focus lies on the efficient and transparent administration of funds, securities, real estate and alternative asset classes. Universal-Investment was founded in 1968 as subsidiary of several well-known private banks. The company is headquartered in Frankfurt/Main and has subsidiaries and holdings in Luxemburg and Austria. As pioneer of the investment industry Universal-Investment is now market leader in the areas of master-KVG and private label funds. Members of the management board are Oliver Harth (deputy spokesman), Markus Neubauer, Stefan Rockel, Alexander Tannenbaum and Bernd Vorbeck (spokesman of the management board). (As per 31 March 2016) Visit www.universal-investment.com for more information.

 

About Trinity Investment Management:

Trinity Investment Management (Trinity IM) Trinity IM are a privately owned property company investing in UK & Ireland, across sectors, with the added dimension of also being retail and community housing specialists. Trinity IM partners with a with a number of UK institutions, UK REIT’s and US Private Equity firms acting in a joint venture capacity. Visit www.trinityim.com for more information.