Investors looking to buy property businesses

May 18th, 2009 by Chris St Cartmail

Recently, we have seen investors looking to get back into the property game. Countrywide, the estate agency group, is to begin the search for acquisitions after its investors strengthened its balance sheet with £37.5m following on from its recent debt restructuring. It was reported in the Sunday Telegraph that Countrywide has £75m ready money to purchase businesses. The company has grown primarily through acquisitions. The strategy will continue as the group takes on smaller troubled estate agents.
Private equity group Apollo Management bought Countrywide in May 2007.

Today, Nick Leslau, well-known property entrepreneur, is to buy up distressed property assets with his new investment company Max Property Group. The £200m new business is to be launched soon on the AIM market. Aubrey Adams, former chairman of Savills, is to be the chairman of the company. Mike Brown, former deputy chief executive of Helical Bar, is also to be an executive.

Adams said: “Difficult conditions in the UK property market present a compelling investment opportunity for those with sector experience and an in-depth understanding of long-term supply and demand issues.”
Max Property will consider investing in all types of property. Leslau aims to close Max Property after seven and a half years, spending five years to invest the fund and two and a half to wind it up.

So now is the time to buy property then. Mind you, any investing at the moment is not for the faint-hearted or the inexperienced. Nick Leslau and Countrywide certainly have bags of experience in this sector. The question is then who else is going to pile in?

UPDATE – 20/05/2009

Three big property investors have announced capital raising plans to fund acquisitions in the depressed property market. Big Yellow, the self-storage property company, has raised £33m through a placement of shares, Great Portland Estates has announced its intention to launch a £150m rights issue, and Shaftesbury has stated it is considering raising capital as well.