Fund Management

Octopus Investments Opens New Commercial Property Fund

Mark Shapland, Reporter, London, 21 October 2014

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UK fund manager Octopus Investments has opened a new fund aimed at the commercial property market.

UK fund manager Octopus Investments has opened a new commercial property market fund.

The company has raised £130 million ($210 million) for the Commercial Real Estate Debt Fund launch and it will be managed by Dragonfly Property Finance - the property finance arm of Octopus.

Funding has been provided by Octopus and a broad range of third-party institutional investors. These investors include a leading European family office and a number of pension funds.

“We are delighted to have been able to offer institutional investors access to this exciting asset class,” said Simon Rogerson, chief executive of Octopus Investments. “There is a real demand from investors for commercial property debt while Dragonfly’s track record in providing finance to entrepreneurs and property professionals is exceptional.”

Dragonfly is targeting an annualised internal rate of return of 11–12 per cent for the fund.

The UK’s commercial property sector has performed increasingly well in recent months, with rental and capital growth benefiting from the wider economic recovery.

Octopus’ launch of the Commercial Real Estate Debt Fund follows swiftly on the heels of its acquisition of MedicX Holdings, the UK healthcare real estate investment manager.

MedicX manages over £0.9 billion of funds across the LSE-listed MedicX Fund and two private closed-ended institutional funds.

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