Allied London buys out Spinningfields investors

ALLIED London has taken full control of the Spinningfields development in Manchester after buying out property investor Delancey and the Royal Bank of Scotland, which each held 40%.

According to the acquisition of Spinningfields’ holding company, Capital Holdco, has been backed by Pramerica – part of US-based Prudential Financial – and a loan from RBS.

Allied London’s chief executive Michael Ingall said: “This transaction enables us to capitalise on our exemplary track record as a successful UK developer and build the business independently.

“We have enjoyed our equity partnership with both Delancey and the RBS Special Opportunities Fund, but now is the appropriate time for all parties to focus on their own business strategies.”

Allied London set up Capital Holdco as an acquisition vehicle with Delancey and RBS in September 2006, when the trio conducted their own buyout of RREEF and JER Partners from Arrow Properties, Allied London’s holding company.

Six years on, Spinningfields is approaching its 2015 completion date and, in financing the buyout, RBS has swapped its equity stake for a lending position.

Capital Holdco’s assets are thought to be worth around £45m. They include 150,000 sq ft of retail and leisure, and Tower 12 — a 75,000 sq ft office and retail block at Spinningfields that had been under offer to CBRE Global Investors before the Pramerica agreement was signed.

Allied London will now retain ownership of the asset, and bring forward several plots that were sold to Manchester City Council as part of a £15.9m sale and leaseback in March 2010. The Hardman Square and Hardman Boulevard plots contain 350,000-400,000 sq ft of developable office space.

Last year London-based Delancey took an equity stake in the Co-operative Group’s NOMA scheme.