Evergreen offloads £30m of loans to pension fund

THE North West Evergreen Fund has transferred a portfolio of four real estate loans worth about £30m to the Greater Manchester Pension Fund.

The deal was structured by CBRE’s Investment Advisory team, part of CBRE Capital Advisors.

Evergreen has sold the loans significantly ahead of maturity, increasing funding capacity for future projects.

The Greater Manchester Pension Fund will also benefit from the increased exposure to high quality schemes in the North West, provided by these performing loans.

The portfolio consists of four major employment use schemes in the North West of England, including MediaCityUK, comprising offices and a hotel, and offices at 1 Spinningfields, City Place, Chester and Soapworks.

Due to the central location of thee developments and the Government’s pledge to invest in the Northern Powerhouse, they have received strong occupational demand. As such an element of pre-let is evident across the portfolio.

The North West Evergreen Fund, which is made up of 16 local authority limited partners, was established to provide funding to support real estate projects, which are critical to the region’s economy, generating jobs and growth.
 
It is capitalised through the European Regional Development Fund (ERDF) and other public money allocated under the Joint European Support for Sustainable Investment in City Areas (JESSICA) initiative, which is managed by the European Investment Bank in the North West on behalf of the Homes and Communities Agency.
 
The Evergreen model provides loan funding to be invested in projects which will generate a financial return and will then be recycled back into the fund to help support further projects.

The fund is advised by CBRE Indirect Investment Services, the FCA regulated arm of CBRE, and co-chaired by Manchester City Council and Lancashire County Council.

Cllr Kieran Quinn, chair of the Greater Manchester Pension Fund, said: “This purchase of the evergreen loan portfolio is yet another example of GMPF’s twin track approach to investments.

“These loans have enabled some of the region’s most iconic properties to be developed and so, as well as securing the retirement savings of our members, this purchase has extracted a huge social benefit for the North West.”

Sir Howard Bernstein, director of the North West Evergreen Fund, said: “We are delighted with the sound investment decisions that have been taken since the fund started in 2011.

“Not only has the fund supported valuable projects which precipitate employment and economic growth in the region, but it has made significant returns on investment.

“These are now being reinvested into future projects, helping to cement the North West’s position leading the Northern Powerhouse.”

Tony Martin, head of investment advisory at CBRE, the investment advisor for Evergreen, said: “Evergreen was established to provide developers with an opportunity to secure much needed finance for strategic sites that will make a significant contribution to the economic growth of the North West of England.

Supported by the Government’s commitment to invest in the ‘Northern Powerhouse’, the need for development funding for employment schemes is accelerating.

“By transferring this latest portfolio, we were able to release valuable capital which can be allocated to the next projects.
 
“Since we established the fund, we have committed close to £100m to local employment schemes. This supports our ongoing strategy to put money back into the region and reinvest in economic growth projects in the North West.”