Argent - Birmingham, Brindleyplace

Date: 22 Mar 2004

The largest ever capital raising from private investors for an asset specific property vehicle in the UK has been secured with 50% of Brindleyplace, one of the UK's most impressive city centre developments, sold to private investors.

Further to the launch of the opportunity to invest in Argent Group's award-winning mixed use Brindleyplace development in central Birmingham last Autumn, Collective Investments has now successfully concluded the £53 million placing of equity in The Brindleyplace Limited Partnership which owns properties valued at £315 million. The average investment value from the 391 private investors has been just over £135,000 with a minimum entry level of £50,000 required.

The Limited Partnership offered a unique opportunity for private investors to invest alongside the original developer and experienced institutional investors, in the long term future of Brindleyplace. Private investors now sit alongside co-investors BT Pension Scheme and Royal Mail Pension Trustees which are managed by Hermes Property Asset Management and have purchased a 40% stake. Argent Group has retained 10% of the development and will act as asset manager, retaining a significant on site team at Brindleyplace.

Collective Investments Managing Director Mark Shaw commented "Private Investors rarely have the chance to invest in such a prestigious scheme, alongside institutions, and with an asset manager of proven track record. The success of this scheme has shown the depth of the private investment market and reinforces the need for innovative vehicles to allow the private investor more accessibility to high quality property investment opportunities."

The Brindleyplace Limited Partnership owns a total of 840,000 sq ft of property consisting of 757,000 sq ft of offices, 32,000 sq ft of restaurants, bars and cafes, 16,500 sq ft of retail space, a 34,500 sq ft health club, a 340 seat theatre and a 903 space multi-storey car park.

Argent Director Gary Taylor said: "We are delighted with the success of the equity placing in The Brindleyplace Limited Partnership. Our original aim was to place just £20 million, however, the overwhelming response we have had from private investors, in such a short timescale, far exceeded our expectations.

"As commercial property looks set to continue to attract interest from all types of investors, The Brindleyplace Limited Partnership is likely to be the first of a new generation of vehicles combining institutional and private money. The response we have had has emphasised that there is a strong appetite for commercial property with private investors and reinforces the need for the introduction of investment vehicles such REITs to increase accessibility for private investors."

The Brindleyplace portfolio has been financed by the combination of a £200 million syndicated debt facility arranged by HSBC and equity from a mix of institutional and private investors. HBOS subsidiary, Bank of Scotland - Corporate Banking, also provided a private loan facility of £10 million to 40% of the private investors. Most of the £21.4 million annual income stream is generated from major occupiers including The Royal Bank of Scotland, British Telecom, Deloitte & Touche and The Post Office with an average lease length of 16 years.

Closure of the offering coincides with completion of the final buildings at Brindleyplace. Seven, Eight and Ten Brindleyplace provide the final 279,000 sq ft of offices in three linked buildings and are fully let to The Royal Bank of Scotland.

Smiths Gore Commercial advised Collective Investments and Jones Lang LaSalle Corporate Finance advised Argent.

Core Building, Birmingham, Brindleyplace

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