KanAm Grund Group has exchanged contracts to acquire 4-8 St Andrew Square, Edinburgh, part of a substantial mixed use asset assembled by Aberdeen Standard Investments (ASI) and developed by them in conjunction with Peveril Securities. The development has been acquired on behalf of German pension fund, die Ärzteversorgung Westfalen-Lippe (ÄVWL). ÄVWL is one of Germany’s largest occupational pension funds, with assets under management of €13.8 billion which includes real estate investments of around €3.0 billion. KanAm Grund Group will also be in charge of the ongoing asset management. The joint venture development was originally completed in 2016 on behalf of the Standard Life Pooled Property Pension Fund.
The sale represents the biggest mixed use investment deal in Scotland since the St James centre in October 2016. Prior to the sale, the Fund agreed a lease variation with Standard Life Aberdeen for period of 20 years, reaffirming its commitment to the building. Around 60% of the income is derived from the offices with the remaining 40% form the retail and restaurants
David Stewart, Fund Manager, Aberdeen Standard Investments commented:
“The development and sale has been a resounding financial success for investors within the Standard Life Pooled Pension Property Fund. At the same time, we take great pride in having made a positive contribution to the local environment, developing a building that meets high levels of sustainability and breathing new life into a strategic part of the City. We have retained the period buildings forming 1-3 St Andrew Square as long term investments and remain confident in the future success of the area.”
Ralph Jones, Peveril Securities added:
“The sale marks the successful completion of the joint venture with ASI and the business plan for the development. As one of the most important Scottish developments in recent years, the scheme led the renaissance of St Andrew Square and the surrounding area. Having won Commercial Development of the Year award in the 2017 Scottish Property Awards, the accolade is a fitting tribute to several years of hard work which resulted in the delivery of a very high quality development.”
The development which is in a prime location in Edinburgh, is fully let on long-term leases and it has a BREEAM* rating of excellent, certifying its sustainability performance. Further tenants include: retail chain TK Maxx and restaurant and bar outlets including Vapiano, The Refinery, The Ivy, Wagamama and Gaucho. The property is close to Waverley train station, a direct tram connection to the airport and the Edinburgh St James, which is due to open next year, offering shops, restaurants, a luxury hotel and apartments over 160,000 square meters.
Scotland's capital is home to around 500,000 people, about a third of employment is in the public sector and public administration, followed by the financial, IT and communication services sectors. Edinburgh is the second largest financial services location in the United Kingdom, with the banking and insurance sector alone employing around 35,000 people.
Savills acted on behalf of the joint venture and CBRE represented the buyer in the deal
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Notes to editors
*The British environmental certification BREEAM (Building Research Establishment Environmental Assessment Method) is the world's oldest and most widely used certification system for sustainability performance.
About Aberdeen Standard Investments
- Aberdeen Standard Investments is a leading global asset manager dedicated to creating long-term value for our clients, and is a brand of the investment businesses of Aberdeen Asset Management and Standard Life Investments. With over 1,000 investment professionals, we manage £519.4 billion of assets worldwide. We have clients in 80 countries supported by 50 relationship offices. This ensures we are close to our clients and the markets in which we invest. (*as of 31 March 2019)
- We are high-conviction, long-term investors who believe teamwork and collaboration are the key to delivering repeatable, superior investment performance.
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About the KanAm Grund Group
The KanAm Grund Group has handled a transaction volume of over 32 billion US dollars since it was established in October 2000. The owner-managed company focuses on the individual needs of German and international investors, with the geographical emphasis being in Europe and the United States.
In order to set it up strategically to face the challenges of the future, the company was reorganized into three business divisions under the umbrella of the KanAm Grund Group: KanAm Grund Kapitalverwaltung-sgesellschaft (an open-end real estate fund), KanAm Grund Institutional Kapitalverwaltungsgesellschaft (a special real estate fund) and the new KanAm Grund REAM (international investment & asset management advisory). The aim of this strategic repositioning is the significant growth of the KanAm Grund Group, as an international real estate enterprise which provides real estate investment and asset management services to German private investors, institutional investors and international investors alike, irrespective of the investment vehicles involved.
Dr. Michael Birnbaum
Phone: +49 (0) 89 210 101 80
Fax: +49 (0) 89 210 101 18