Pradera investors to explore secondaries sale

Partners Group and CBRE are reported to be interested in the retail real estate investment management firm’s second European fund.

Investors in Pradera European Retail Fund 2, a pan-European fund raised in 2006 to buy shopping centres and retail parks, have appointed Accord, a capital advisory firm, to assess their options ahead of the fund’s termination at the end of this year, sister publication PERE has learned.

The fund attracted €260 million of equity from investors and the money was invested in assets in markets including Spain and Italy. However, even though the vehicle is at the end of its 10-year lifespan, some of the assets have not seen their business plans realised. Rather than extend their commitments, it is understood that some of the fund’s investors are keen to explore liquidation options such as sales on the secondaries market.

That has alerted potential buyers, including Partners Group and CBRE Global Investment Partners. Talks between Accord and these prospective bidders are expected to start over the coming weeks with a view to all or some of the fund positions being sold.

Although Accord was appointed by the fund’s investors, Pradera, a European retail real estate investment management firm, is understood to be collaborating in the process.

The appointment of Accord comes one month after LJ Partnership, a multi-family office with approximately $4 billion of capital from Hong Kong and Latin America, made a strategic minority investment in Pradera. The investment was intended to strengthen the firm’s future prospects, with managing director David Fletcher commenting at the time that it would help take Pradera into new sectors and geographies.

The investment by LJ Partnership came a year after Pradera chairman Colin Campbell financed a management buyout of the firm. Campbell effectively bought out his long-time majority co-owner Paul Whight after a concerted effort between them to recapitalise the business failed to materialize in an investment.

In the meantime, the firm has also experienced senior departures. Earlier this month, executives Neil Varnham and Richard Gore left to join Savills Investment Management, the real estate investment management business of London-listed property advisory firm Savills. They followed James Bury, Pradera’s former managing director, who joined the same firm last year.

Pradera currently manages 43 assets valued at more than €2 billion.

Neither Pradera nor Accord would comment.