LREDS III provides Lone Star mezzanine loan for UK hotel portfolio

LONDON (March 15, 2018) — LaSalle is pleased to announce that its £804m fund, LREDS III, has extended a five-year mezzanine facility of £22.2 million to refinance a portfolio of forty hotels managed by the Shearings Leisure Group.  The refinancing replaces a platform facility and will facilitate an extensive capital expenditure programme following the consolidation of the group’s ownership under funds managed by Lone Star.

LREDS III is off to a strong start having already deployed £233 million. The fund has seen an increase in lending activity in recent months; recent selected deals include:

  • £24 million (€28 million) mezzanine loan to finance the acquisition of a leading designer outlet centre in Scotland for Blackstone.
  • £38 million (€28 million) five-year mezzanine loan to finance the acquisition of a UK retail portfolio for Capreon (formerly BMO).
  • £27 million (€31 million) mezzanine loan secured against a dominant shopping centre in the UK for a major real estate private equity firm.
  • Acquisition and development whole loan secured against a prime Spanish student housing portfolio for GSA, Global Student Accommodation.
  •  £22 million (€25 million) five-year mezzanine facility to finance the acquisition of a portfolio of five assets in Germany for Ares Management.

The most recently launched fund in LaSalle’s debt series has seen strong demand from investors across all regions globally, and has been the most successful fund raise in the series to date.  LREDS III’s capital raise was oversubscribed closed with aggregate commitments of £804 million, exceeding its initial £750 million target. LREDS III has attracted 17 LPs from all over the world, comprising a diverse mix of investors from Europe, the Middle East, Asia and United States.  The fund retained support from existing investors as well as attracting capital from investors that were new to the fund series.

Amy Klein Aznar, Head of Debt Investments and Special Situations at LaSalle Investment Management, said: “Given the excellent fundraising for LREDS III in 2017 and our strong position as an established lender in the European market, I am delighted to announce the sixth deal for the fund.  Following on from 2017, we continue to be very active across the debt lending space and have appetite to lend further into the hotel space for the right sponsors and business plans.”

LaSalle’s Debt Investments and Special Situations team, headed by Amy Aznar, has a strong track record of developing strategic relationships with best-in-class borrowers and senior lenders, and has significant experience across various sectors, geographies, deal sizes and capital structures. Since 2010, the team has committed £2.1 billion ($2.9 billion) of investments in 54 individual transactions and secured against £9.3 billion worth of real estate.

About LaSalle Investment Management 

LaSalle Investment Management, Inc. (together with its global investment advisory affiliates, “LaSalle”) is one of the world’s leading real estate investment managers. LaSalle on a global basis manages approximately $59.5 billion as of Q2 2018 of private and public equity and private debt investments. LaSalle’s diverse client base includes public and private pension funds, insurance companies, governments, corporations, endowments and private individuals from across the globe. LaSalle sponsors a complete range of investment vehicles including separate accounts, open- and closed-end funds, public securities and entity-level investments. LaSalle Investment Management, Inc. is a wholly-owned, operationally independent subsidiary of Jones Lang LaSalle Incorporated (NYSE: JLL), one of the world’s largest real estate companies. For more information please visit www.lasalle.com

This information is based on the market analysis and expectations of LaSalle and should not be relied upon by the reader as research or investment advice regarding LaSalle funds or any issuer or security in particular. The information presented herein is for illustrative and educational purposes and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy in any jurisdiction where prohibited by law or where contrary to local law or regulation. Any such offer to invest, if made, will only be made by means of a private placement memorandum. Past performance is not indicative of future results.

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