Select Property Fund extends direct property portfolio

Standard Life Investments, one of the largest property fund managers in Europe, today announced that its Select Property Fund has bolstered its direct property portfolio with acquisitions in Germany and Poland.

Representing its first move into the German property market, the Select Property Fund has purchased a recently completed and fully let retail park in Östringen, a town south east of Mannheim in the Frankfurt region. The €8.3m acquisition consists of 4,500sqm of retail space providing seven units in total and 167 parking spaces. It is let to a number of good quality national retailers. The acquisition represents an initial yield of 6.6%.

In a joint venture with Panattoni Development Company (“PDC”), Standard Life Investments’ Select Property Fund is also increasing its exposure to the Polish market with the development of a 32,000sqm majority pre-let logistics building in Poznan, Poland. Located approximately 15km south east of the city, the site forms an extension of the existing Panattoni Park.

James Rushworth, Director of European Property, Standard Life Investments, said: "The German economy is showing strong signs of improvement so I’m pleased that we have added to the Select Property Fund’s existing indirect German property holdings. We have managed to acquire a good quality scheme which is let on long leases to established retailers located in an affluent part of western Germany.

“I’m also very pleased that we are working with Panattoni again so soon after our first collaborations in Poland and the Czech Republic. Poznan reflects our favourable view of the polish logistics sector which is being driven by GDP growth, low costs and central location in Europe. “Both acquisitions are valuable additions to the fund and go some way towards meeting our objective of increasing the fund’s direct property exposure to 20%.”

In January SLI announced that it was entering into partnership with PDC to develop two distribution warehouses in Central Europe. The first, a 50,000sqm distribution warehouse facility located in Lodz, Poland, is expected to be completed in September 2007. The second is located in Plzen, Czech Republic. Phase I of the development will consist of 28,000sqm and is due for completion early in Q2 of this year. There is strong indicative interest for further capacity and an additional 33,000sqm is planned.

Launched in October 2005, the Select Property Fund has grown to more than £1.5bn in assets under management. The performance of the fund has been very strong, with the retail accumulation unit price rising 56.8% since launch. The first of its kind in the marketplace the Select Property Fund offers both institutional and retail investors access to UK and international property markets in North America, Europe and across Asia Pacific. The fund accesses commercial property markets via direct investment, unquoted specialist property products and stock exchange listed property vehicles globally.