Abrdn Property Income Trust (API) has agreed to sell a 39-asset UK portfolio to Travelodge owner GoldenTree Asset Management for £351 million.
The UK portfolio includes retail, office, industrial and other assets. The proposed sale does not include land at Far Ralia in the Cairngorms, API told shareholders.
GoldenTree has paid a deposit of £35.1 million with the rest due to be paid in cash upon takeover.
UK portfolio managed wind down
James Clifton-Brown, chair of API, says, “The board considered the GoldenTree Asset Management bid provided the best solution for shareholders, compared with the net present value of what might be achieved by way of individual sales over a longer period and represents a swift implementation of the shareholder resolution to conduct a managed wind down.”
An external valuation of the API portfolio on 30 June 2024 was £381.6 million.
In March 2024, a bid by Custodian Property Income REIT to take over API failed to secure 75% shareholder approval.
In May, API Shareholders approved a Managed Wind-Down of the assets to repay borrowings and make returns of capital, whilst also obtaining the best value.
Most effective means of disposal
James Clifton-Brown says, “Since the shareholder vote on 28 May 2024 to put the company into a Managed Wind Down was passed, the board, alongside the Investment Manager, explored the most effective means of disposing of the company’s assets. The aims were to maximise the returns to shareholders but also to return cash to them as soon as possible. The full range of disposal strategies was considered from individual property sales to a wider transaction. Through an independent agent, Gerald Eve, the whole portfolio was marketed to potential buyers in an extensive and competitive process.”
The transaction follows an extensive process by API and its advisers to identify a buyer for the portfolio.
Completion of the Transaction is anticipated to take place on 29 November 2024.
Subject to consent from the Scottish Forestry Commission, Far Ralia will be transferred from APH to API prior to completion. The Transaction is also subject to clearance under the UK National Security and Investment Act 2021.
GoldenTree
GoldenTree is an employee-owned, global asset management firm. It specialises in opportunities in sectors incuding high yield bonds, leveraged loans, private credit, distressed debt, structured credit, emerging markets, real estate, private equity and credit-themed equities. It manages nearly $55 billion for institutional investors including leading public and corporate pensions, endowments, foundations, insurance companies and sovereign wealth funds.
Farran Investments, a privately-owned commercial real estate specialist acts acts as an advisor to GoldenTree. Itis a minority co-investor in the acquisition vehicle incorporated by GoldenTree and will become the asset manager.
The image by Roy Hughes of the B&Q Warehouse, Halesowen is from Wikimedia and is reproduced under CreativeCommons.
