European-focused, private real estate investment company Feldberg Capital (Feldberg) has acquired 21-25 Bedford Street, London WC2, for around £75 million.
It was bought for its ReForm Fund, a brown-to-green workplace fund, investing in energy-inefficient ‘brown’ offices. The fund takes advantage of Feldberg’s innovative ESG capability to retrofit and reposition these assets into modern green workplaces.
The Fund targets assets in Central London’s growth locations underpinned by excellent connectivity and amenities, including Covent Garden, Soho, Fitzrovia and Bloomsbury.
Prominent building
The prominent building at 21-25 Bedford Street is less than 100 metres from Covent Garden Piazza and is close to Covent Garden, Leicester Square and Tottenham Court Road station.
In line with the ReForm Fund strategy, ESG upgrade measures will include the removal of gas boilers, installation or air-source and water-source heat pumps, and also installation of on-site solar panels. An asset-specific charity partnership will be chosen based on the results of a needs assessment of the local Covent Garden area.
These examples highlight ReForm’s status as a pioneering impact fund focussing on both decarbonisation as well as delivering on social objectives. The investment strategy includes ambitious ESG targets and innovative features that will ensure ReForm has a meaningful positive impact for all stakeholders. ReForm is one of the first UK funds to link a proportion of the manager’s performance fees to pre-determined ESG targets, creating alignment between investors’ ESG ambitions and financial returns.
ReForm impact fund
Feldberg launched ReForm impact fund in October 2023 in response to growing dislocation between healthy, tech-enabled, green workplace assets where tenant demand is exceptionally strong, and also older, less energy-efficient offices that are at risk of asset stranding. Embarking on this strategy at a time in the market where there are macro-economic and structural
challenges has created attractive buying opportunities for the Fund.
This follows the first Fund acquisition in December 2023 of 8 Bloomsbury Street, a 33,448 sq ft building located close to Tottenham Court Road station, which is currently undergoing a retrofit to provide bespoke, fully-fitted, green workplace. ReForm received significant backing from a cornerstone UK institutional investor in October 2023, followed by a second close in December 2023. The Fund has a fundraising target of £300 million, which will provide firepower of around £500 million including leverage.
Robert Allen-Mersh, Director at Feldberg says, “This acquisition continues to support our thesis that we are seeing a once-in-a-cycle opportunity to invest in Central London’s best commercial real estate assets at very attractive values. 21-25 Bedford Street is a very high-quality mixed-use building in the heart of Covent Garden with exciting asset management upside.”
Will Amies, Head of Business Development at Feldberg says, “21-25 Bedford Street marks ReForm’s second transaction following the impact fund’s acquisition of 8 Bloomsbury Street late last year. We achieved first close on ReForm in October 2023 and subsequently quickly reached second close in December 2023. Our ability to fundraise in the current climate is testament to the belief investors have in our ability to deploy capital quickly into good buildings at very attractive pricing.”
