The Carlyle Group Enters the UK Real Estate Market with City Acquisition

London, UK – Global private equity firm, The Carlyle Group, has made its first real estate acquisition in the UK. This marks the launch of the Carlyle Real Estate Partners into the UK market. The investment is for the leasehold interest for the property located at 107 Cheapside, EC2, and the value of the transaction is £67million. Carlyle bought the property from AXA Sun Life.

The acquisition is a strategic one for the Carlyle Europe Real Estate fund, which has a highly selective approach to acquisitions and asset management, and generally invests in mid-sized properties in the office, industrial and retail sectors. The property includes 125,000sf of office space and 50,000 sf of retail space. 107 Cheapside is currently 95% leased and it is expected that the office space should become partially vacant over the next 3 years. Carlyle plans to refurbish the property in the medium-term when office space will be released.

“I am delighted to have completed this acquisition in London. The property is in an excellent location for both offices and retail and we see a lot of potential in the refurbishment and development of this property, and generally in the London market,” said Robert Hodges, director of The Carlyle Group, who led the transaction.

To date, the Carlyle Europe Real Estate Partners fund has invested in 50 properties in France, Germany and Italy. The fund has deal teams with local experience and local contacts who identify growth potential in their investments and take a proactive asset management approach to add value through development and refurbishment in well- established markets.

“We have made some good investments in France, Italy and Germany, and I am very pleased to be making a footprint in the UK market. We make each investment decision with a single asset approach but we hope to make more acquisitions in the UK over the coming months,” said Eric Sasson, managing director of The Carlyle Group, who heads up the firm’s European real estate team.

Carlyle’s legal advisers on the transaction were Herbert Smith, and were advised by GVA Grimley. Financing was provided by EuroHypo.

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