The flagship value-add property fund for Hines in Europe has bought an asset in London’s West End for a mixed-use project.
The €720m Hines European Value Fund (HEVF) acquired 354–358 Oxford Street from Transport for London for an undisclosed sum.
Hines said the asset, located above the Bond Street underground station entrance, will deliver retail space across the basement, ground and first floors. Above the retail element, Hines will create residential accommodation across the four upper floors.
Jake Walsh, the director of Hines UK, said: “Securing one of the most sought-after prime locations in the West End of London represents a milestone transaction for Hines, demonstrating our capability to source and convert the most attractive opportunities in an incredibly competitive market.”
Paul White, HEVF fund manager, said: “The acquisition of 354-358 Oxford Street is another example of HEVF’s commitment to focus only on the best micro-locations within its target markets.”
The mixed-use components of this new project offer the fund strong downside protection during uncertain macroeconomic times, White said: “HEVF is thrilled to acquire its first asset in London and looks forward to acquiring additional compelling value add assets in the city in the near future.”
The deal is HEVF’s fifth acquisition in the last 12 months. The previous deals were made in Stuttgart, Copenhagen and Barcelona, along with a fourth acquisition in exclusivity.
Graeme Craig, the director of commercial development at Transport for London, said: “We are delighted to have concluded this transaction at a prime West End location, which will provide a significant return to reinvest in the transport network.
“Our investment strategy will continue to see us undertaking a small number of targeted disposals whilst we concentrate our own development activity on Build to Rent in outer London to generate ongoing revenue as well enabling us to provide high levels of affordable housing.”
RPA Perspective In September Hines announced that European institutions had backed the flagship value-add fund for Hines in Europe to exceed its original fundraising target by more than 40%.
The manager said Hines European Value Fund (HEVF) has raised over €720m at the final close, receiving commitments from a primarily European group of 16 limited partners including German, Italian, Norwegian, Spanish, French and Finnish institutional investors, alongside Hines co-investment as sponsor.
The limited partner group includes subscriptions from Allianz, Intesa Sanpaolo Vita, Nordrheinische Ärzteversorgung (NAEV), Kirchliche Versorgungskassen KZVK / VKPB, OP Real Estate and the Finnish Church Pension Fund, Formuesforvaltning, Kommunaler Versorgungsverband Thüringen (KVT), Wealthcap and other well-respected German and Asian pension fund and insurance group clients.
HEVF has a geographic mandate across the European Union (plus Norway) and flexibility of scope to invest in office, retail, logistics, residential and mixed-use opportunities in primary institutional markets.
In the first 12 months following the fund’s initial closing, HEVF had committed around €200m equity to the fund’s first three project investments in Stuttgart, Copenhagen and Barcelona, along with a fourth acquisition in exclusivity, the manager said.
Paul White, HEVF fund manager, said: “The HEVF management team and Hines leadership are delighted by the success of the capital raising for our flagship European value-add vehicle, which is intended to be the first in a recurring HEVF series stretching across cycles in our target markets. We are focused now on the work of very selectively assembling a fund portfolio to deliver the investment objectives of those investor partners who have placed their trust in this mandate.”
