Distressed-Investment Giant Spends £1.2B In The UK In A Year
One of the biggest investors in UK real estate during the last crash has completed a third deal in the space of a year, taking its spending to £1.2B.
Lone Star Funds is in talks to buy a £400M portfolio from funds run under the St James’s Place brand, Green Street News reported. The portfolio is part of £1.8B of funds that are being liquidated to give investors their money back.
The portfolio is a mix of offices, industrial and retail assets. Invesco took over the management of the funds in June.
Lone Star bought a portfolio of nine student accommodation assets from Unite Students in June for £212M. The portfolio comprises 3,656 beds in five cities: Aberdeen, Leicester, Leeds, Nottingham and Sheffield.
And the firm bought the Tiger portfolio of 39 assets across the UK last October from private investor Charles Street Buildings Group for £600M. It has already begun selling from the portfolio, offloading a portfolio of five retail assets to Zinc RE for £63M in January.
Lone Star came to prominence in the UK in the wake of the 2008 Lehman Brothers collapse, buying large portfolios of distressed loans from lenders like Lloyds Bank. While the portfolios it is buying now aren’t distressed in the same way, they do comprise large numbers of smaller assets, which Lone Star’s in-house asset manager, Hudson Advisors, will now oversee.
The firm raised $2.7B for its seventh real estate opportunity fund in September 2024.
A deal with Lone Star would mean that £1B has been sold from the three St James’s Place funds. Earlier this year, Ares Management bought a £210M portfolio from the funds.
