First Property Group plc (AIM: FPO), the property fund management group, is pleased to announce that it has entered into a new fund management agreement with an existing pension fund client, the Shipbuilding Industries Pension Scheme (“SIPS”), to establish and manage a new property investment fund (“the new fund”). SIPS has committed a minimum of £125 million to the new fund for an initial term of ten years. SIPS was advised by Hymans Robertson LLP.
The new fund will be unleveraged and will target a net total return of 7% per annum or more from investments in property in the United Kingdom. The investment remit is broad, encompassing both investment and development properties across all sectors, including offices, retail, industrial and residential. First Property Group will earn annual fees from the new fund calculated by reference to the value of the properties under management.
Ben Habib, Chief Executive of First Property Group, said:
“We are very pleased to have been awarded this broad investment mandate which reflects the confidence SIPS has in us. The broad mandate enables us to tailor our investment approach to prevailing market conditions and to deploy capital where it is likely to earn the highest returns.”