Paloma Capital Acquires RVB Investments in £90m Deal
Paloma Capital has completed a landmark deal to acquire West Midlands-focused industrial and office landlord RVB Investments from an overseas family for about £90m.
RVB, which was established in 1975, owns 32 warehouse and eight office assets that produce a total rent of £7.1m a year.
The deal is a milestone for Paloma Capital, which was co-founded by Joe Froud and Jack Pitman in 2015. Froud said the fund manager had been working on the transaction for eight months.
“Despite our experience in corporate transactions it was a complex process involving a 42-year-old firm with a portfolio of multi-let assets,” he said. “However, these are exactly the sort of assets that we are targeting for our warehouse strategy.”
The properties are spread across the UK but the majority are located around Birmingham and the West Midlands, with a particular concentration in Telford. They have an average unexpired lease term of 4.5 years.
Paloma completed the purchase on behalf of its debut fund, Paloma Real Estate Fund I, which raised £140m in June, giving it firepower to invest in £300m. As a result of the deal, 90% the fund has now been committed.
Pitman added that the fund manager was already working up plans for a second fund “taking advantage of our successful niche strategy and active transaction pipeline”.
The bulk of Paloma’s portfolio is focused on the multi-let industrial sector. The fund targets smaller undermanaged assets and drives value through capital investment and active tenant engagement.
Other acquisitions to date include Crossley Industrial Park in Stockport, Globe Industrial Park in East Manchester, Manorside Industrial Estate in Redditch and The Flint Portfolio of retail warehouses acquired from B&Q.
Paloma’s key acquisitions so far include Crossley Industrial Park in Stockport (pictured).
Paloma’s acquisition of RVB was financed by two of its existing lenders – Santander on the warehouse assets and RBS on the offices.
Paloma was advised by Greenberg Traurig, FSP and Knight Frank, while the vendor was advised by EY and Mills & Reeve.
“The transaction allows our clients to achieve the exit that they required and Paloma to deploy capital in the market in an efficient way to take the portfolio forward,” said Fergal O’Reilly, associate partner, real estate corporate finance at EY.