The Valesco Group, the London-headquartered European real estate investment and asset manager, has agreed to sell a strategic minority stake in the business to New World Capital Advisors (NWCA), the global merchant banking and investment group.
NWCA’s strategic investment offers Valesco not only balance sheet capital but also access to a strong line-up of institutional investors as Valesco raises €1 bn of equity for a fully discretionary core/core-plus fund, which will ultimately have the firepower to acquire up to €2.5 bn of European assets.
A number of limited partners (LPs) have already agreed to anchor the launch of Valesco’s new fund.
Founded by Shiraz Jiwa, Valesco has rapidly grown its European core and core-plus portfolio of assets under management by close to €1 bn over the past 18 months alone.
Investments include a number of off-market landmark European real estate assets including London’s Cannon Bridge House for £250 mln (€297 mln), Microsoft’s UK headquarters and Amazon’s Central European headquarters. Valesco is backed by institutional capital from Asia, in particular Korea. Its team members come from financial services firms such as Goldman Sachs, Morgan Stanley and Blackstone.
Valesco’s Jiwa said in a statement: ‘This transaction marks an important milestone in the trajectory of the business as we increase and diversify our pools of sovereign and institutional LPs who are looking for a strong and aligned partner to effectively and efficiently deploy their capital in order to achieve strong risk adjusted returns across a variety of European real estate investment theses and products.
He added: ‘Having a strategic shareholder of the quality and reach of NWCA positions us to execute on the next phase of AUM growth and investment product diversification.’
The investment by NWCA is the latest in a series of strategic investments it has made as it seeks ‘best in class’ operators within specialised fields.
Zeiad Idris, managing partner and co-founder of NWCA, said NWCA had long admired Valesco. ‘We believe Valesco is going to grow to be the pre-eminent European real estate investment firm through its relentless focus of nurturing long-term, win-win partnerships with investors, developers, asset owners, lenders, tenants and employees.’
Adam Sadiq, managing partner and co-founder of NWCA, added: ‘We are delighted with our latest investment in The Valesco Group which supports our long-term vision as we continue to build upon our investment strategy, ensuring alignment of interest throughout the investment life cycle whilst delivering strong risk-adjusted returns.’