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Barwood Capital raises £48m for fifth fund with target IRR of 13 - 15% and secures first deal


Barwood Capital, the Northampton-based UK regional investment and development specialist, has successfully raised £48 million of equity for its Regional Property Growth Fund IV, putting it on track to achieve its target of £100 million, with a hard cap at £150 million.

Barwood Capital’s fifth property fund launched in spring 2019 and is a five-year closed ended fund that will invest in UK regional property outside London, driven by significant ongoing changes in technology, infrastructure and demographics. With a target investor IRR of 13-15% per annum, investors are also able to take advantage of opportunities for significant co-investment.

The Fund will focus on industrial, alternatives, selective offices and real estate opportunities benefitting from improved infrastructure investment. These will be in under supplied key regional locations with good occupational demand, a need for investment and the potential for strong rental growth prospects.

Investors include high net worth individuals, family offices and Merseyside Pension Fund, which also invested in the Barwood Property 2017 Fund. A number of other investors are currently going through due diligence and further closes are expected in Q4 2019 and Q1 2020.

An industrial development opportunity in Sittingbourne, Kent has already been secured and two further investments, in the industrial and care home sectors, are under offer.

Jo Greenslade, founder and director of strategy & funding at Barwood Capital, said: “Given the difficult political environment, we are delighted to have successfully achieved almost half our target raise within a few months of launching our new Fund. Over 90% of the investors in Growth Fund IV have invested in previous Barwood Capital property funds and their willingness to reinvest in our fifth property fund demonstrates their confidence in our strategy, people and pipeline and ultimately in our ability to deliver outstanding returns.”

Hugh Elrington, managing director at Barwood Capital said: “Our investment strategy is to acquire sites, underperforming or obsolete property assets across the UK regions which have the potential for significant value to be added through planning, development and active asset management. We will focus on growing sectors and exploit the arbitrage between the value of undermanaged secondary investments and prime income producing investments.

“We take a diversified portfolio approach, ensuring a spread of locations, sectors, development stages and income profiles. To have one project exchanged and two further under offer, demonstrates that already we have an identified and clear pipeline of opportunities in which to invest.”

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