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TH Real Estate launches Global Real Estate Debt Partners – Fund II (UK)

Christian Janssen

TH Real Estate has completed the first close of its £500m Global Real Estate Debt Partners – Fund II (UK), and commenced its investment programme with a £44m loan in the South East of England.

With capital committed from Asian, US and European institutions, investors cited the potential for stable, income-focused returns with a low correlation to the wider property and investment markets, as supportive factors.

The seven-year term Fund invests in whole loans up to 75% loan-to-value, targeting an 8-9% gross IRR and 6% net income return. Loan origination is focused on high-quality real estate, well-positioned across South East and regional markets of the UK. The Fund will utilise a senior syndication strategy of selected whole loans in order to enhance returns and optimise its investment portfolio.

The successful first close of the Global Real Estate Debt Partners – Fund II (UK) follows the origination of £1bn in new loans in 2017 and the completion of £750m in new loans so far this year. The firm’s global debt platform has grown significantly in recent years, and continues to invest at pace, attracting capital for a range of pooled funds and separate mandates from a global client list. The platform recently announced plans to expand into Asia Pacific with the appointment of Martin Priestly as Head of Debt for the Asia Pacific region.

Christian Janssen, Head of Commercial Real Estate Debt, Europe, at TH Real Estate, comments: "The success of this first close demonstrates the appeal of investing in debt and, in particular, our strategy, which aims to offer a measure of downside and performance protection, diversification and the opportunity for stable income-focused returns. We are delighted to see investors from our first fund strategy, invest in the second, showing continued support for the platform. The Debt team’s experience, global track record and extensive originations network ensures our ability to source and manage the very best opportunity for our clients."

TH Real Estate's global debt platform, which has been investing since 1934, manages assets of over $29bn across the US and UK, representing 25% of the overall business. It invests across the capital structure, seeking income-focused, stable and attractive, risk-adjusted total returns for investors through a diversified portfolio of commercial real estate debt investments.

In order to provide investors with a tailored solution, TH Real Estate has developed its resilient, enhanced and debt series. The debt series is designed to provide investors with access to potentially secure, income-focused returns. The strategy may suit cautious investors seeking attractive levels of income with a measure of downside protection against short-term capital cycles.

Issued by Nuveen Real Estate Management Limited, 201 Bishopsgate, EC2M 3BN. Authorised and regulated by the Financial Conduct Authority. TH Real Estate is a name under which Nuveen Real Estate Management Limited provides investment products and services. TH Real Estate is a real estate investment management holding company owned by Teachers Insurance and Annuity Association of America (TIAA). TH Real Estate securities products distributed in North America are advised by UK regulated subsidiaries or Nuveen Alternatives Advisors LLC a registered investment advisor and wholly owned subsidiary of TIAA, and distributed by Nuveen Securities, LLC, member FINRA. The target return above is derived from both quantitative and qualitative factors, including historical returns and market conditions and assumptions (including but not limited to occupancy rates, market conditions, cap rates and availability of financing). The Fund’s target return is presented to establish a benchmark for future evaluation of the Fund’s performance, to provide a measure to assist in assessing the Fund’s anticipated risk and reward characteristics and to facilitate comparisons with other investments. Any target data or other forecasts contained herein are based upon subjective estimates and assumptions; if any of the assumptions used do not prove to be true, results may vary substantially. The target return is pre-tax and is after fees and expenses. In any given year, there may be significant variation from these targets, and the General Partner makes no guarantee that the Fund will be able to achieve the target return in the long term. This fund involves a risk of capital loss. 456889-G-MED-O-03/19

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