Singapore-based Elite Partners Capital buys 97 freehold UK offices for around $500m

SINGAPORE - Singapore-based private equity firm Elite Partners Capital said on Monday (Nov 26) that it has acquired a portfolio of 97 commercial properties in the United Kingdom from British developer Telereal Trillium for £282.15 million (S$496 million).

The Hayhill Portfolio of freehold offices is mostly located in town centres across the UK and measures a combined 2.6 million square feet. It is currently let to the UK government's Department for Work and Pensions on 10-year full repair and insurance leases with built-in rent uplifts until March 31, 2028. About 99.4 per cent of the rental income is secured against the covenant of the UK Secretary of State for Communities and Local Government.

The acquisition is the first significant transaction by the private equity firm's Elite UK Commercial Fund, which focuses on UK real estate. The fund said that it has raised £120 million in equity and mezzanine funding from more than a dozen institutional investors, family offices and ultra-high net worth individuals.

Elite said the portfolio has potential for capital gains upon asset enhancement, with chief executive officer and managing director Victor Song adding that the portfolio offers low-risk sustainable long-term yield with its attractive geographical spread and brand new leases to the UK government.

"The investors of the fund can expect strong and stable income, coupled with potential upside from rental reviews and capital gains through asset enhancements and conversion for alternate uses. We will continue to look into acquiring new assets for this fund," said Mr Song.