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Brixton currently has two joint ventures in operation: Equiton and Heathrow Big Box Fund.
The joint venture funds give our investing partners access to our market expertise while providing us with alternative financing arrangements and new revenue potential through activity and performance-based management fees. The average net geared returns on capital employed for the last 3 years (2005-2007) were 19% pa for Equiton and 26% pa for Heathrow Big Box.
Equiton invests in sub-£20m investments in the South East and currently holds 42 assets totaling 2.9m sq ft worth over £340m as at June 2008. July 2004 saw the completion of the fund’s restructuring whereby the Prudential and Brixton’s stakes are now 44% and 30% respectively with SE Ind Trust (formerly Equitable Life) at 26%. Equiton has enabled Brixton to leverage its asset management and customer relationship skills to earn fee income while also generating good returns for our partners.
The Heathrow Big Box fund was created in 2004 when Brixton sold a 50% stake in Axis Park and Heathrow Corporate Park into a 50:50 venture with Prudential Life Assurance Limited. The total consideration of £108.9m demonstrated a net initial yield of 6%. The fund is intended only as a vehicle to hold these two assets which have a distinct size, age, physical and location profile unique within the Brixton portfolio. The deal released capital from prime, well-let stock to utilise on more income enhancing opportunities, as well as gearing up this vehicle. The two properties total 1.22m sq ft and are now worth over 270m as at June 2008.
If you’d like more information on Brixton joint ventures, please contact Mike Andrews on 020 7399 4518
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