Newcore plots £375m equity raise for new fund
Real estate investment manager Newcore Capital is targeting a £375m equity raise for a new core-plus fund.
The Newcore Sustainable Income Trust will launch by the end of Q4 this year. The fund will focus on acquiring real estate with “sustainable long-term uses and affordable rental levels”, targeting annual returns of 9-11% with a 5% annual dividend. It will be semi-open ended, with structured liquidity flows for primary redemption and new capital raising.
Acquisitions will be UK-focused, principally in London and the South East, as well as regional centres with strong local economies.
Real estate investment manager Newcore Capital is targeting a £375m equity raise for a new core-plus fund.
The Newcore Sustainable Income Trust will launch by the end of Q4 this year. The fund will focus on acquiring real estate with “sustainable long-term uses and affordable rental levels”, targeting annual returns of 9-11% with a 5% annual dividend. It will be semi-open ended, with structured liquidity flows for primary redemption and new capital raising.
Acquisitions will be UK-focused, principally in London and the South East, as well as regional centres with strong local economies.
Newcore, which specialises in social infrastructure, said it has already identified a circa £300m pipeline of potential assets. It manages around £500m in assets across its value-add series and existing core-plus strategies.
Sectors of focus include education, waste management, medical research and pathology, storage, clinical healthcare, and transport.
Hugo Llewelyn, chief executive at Newcore Capital, said: “The dislocation in the capital markets creates an attractive opportunity in social infrastructure real estate for experienced investors looking to create core strategies of scale.
“The Newcore Sustainable Income Trust will be structured to allow five-yearly primary redemption windows to investors, which we think will better serve investors than open-ended real estate funds with daily or monthly liquidity, where there can be a liquidity mismatch in weaker markets.”
Neil Sarkhel, chief operating officer at Newcore Capital, said: “Institutional interest in social infrastructure assets, a segment of the UK real estate market not always targeted by traditional managers, has been demonstrated by the successful fundraise for our latest value-add vehicle – our largest to date.
“Our new core-plus fund will replicate our previous strategies at scale, aggregating hard-to-access, granular assets to create a diversified, resilient portfolio that commands an agglomeration premium and delivers reliable, steady returns for our investors.”
The fund launch follows the final close for Newcore’s latest value-add vehicle, Newcore Strategic Situations V, which secured £190m in equity commitments in May.
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