55% equity release made by IIB to investors in London property
International Investment Bank, a globally-focused investment bank based in Bahrain, has announced that it has achieved for its investors an equity release of 55% of their original investment in the office building at 33 Grosvenor Place in the prestigious Belgravia area of London, which it acquired with its partners for US$280 million in June 2005. The cash dividend to investors has also been increased to 10% p.a. on both the original and the remaining equity.
IIB’s Chief Executive Officer, Mr. Aabed Al Zeera, commented: “Although this investment was made only 15 months ago, and was placed with our Investors on the basis of a five year investment holding period, a cash dividend of 7.5% p.a. and an IRR in excess of 10% p.a., we have been able to return a substantial portion of equity to our investors, while boosting the cash dividend of 10%, and we expect to comfortably exceed our IRR target at final exit. This is the result of a strong rise in prime commercial property values in the West End of London over the past 18 months, and the competitive acquisition price that we paid for this specific property.”
Independent forecasts currently indicate solid rental growth for such properties over the next five years, so this should underpin the increased value of 33 Grosvenor Place. “The high returns that we have been able to generate on this investment in such a short period underline the value of IIB’s strategic approach to investing. We seek out attractive assets that are diversified by country, sector and currency, thereby providing our Investors with a balanced portfolio that also offers good returns,” added Mr. Salah Nooruddin, IIB’s Chief Operating Officer. “We will continue to manage this property so as to further enhance the returns to our investors, and we expect to present similar opportunities in additional European real estate assets in the near future.”
33 Grosvenor Place is a landmark building occupying a prime site in Central London. It overlooks the gardens of Buckingham Palace, and benefits from a long-term lease to the UK subsidiary of one of the worlds leading energy companies.
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