Newcore Capital, the UK-based investment manager focused on social infrastructure, has acquired four assets across South-East England for £20m on behalf of its latest value-add fund and two core-plus separate accounts.
The acquisitions follow the final close of NSS V fund, which secured £190 million in equity commitments from various investors, including local government pension schemes.
The latest acquisitions come after Newcore spent £25m in July on acquisitions across Greater London and surrounding commuter towns as the manager aims to make the most of market dislocation.
The purchases include an office building with retirement conversion potential in Thames Ditton for c.£10m, two petrol stations with EV charging potential in Southampton and in Three Bridges for an aggregate price of c.£7.5m, and a special educational needs school in Reading for c.£2.5m.
Today’s announcement sees Newcore continues its longstanding strategy of acquiring assets that serve essential societal needs. As such, they are all economically capable of continuing or converting through to uses such as EV charging, education, and senior living.
The acquisitions also adhere to Newcore’s geographic focus on the South-East of England, where demand-supply dynamics are most favourable and there is strong potential for alternative uses at sustainable rents.
Newcore typically acquires smaller, granular assets of £2m-£20m in these areas, where it is able to leverage its extensive regional expertise and fully utilise the agile approach it adopts towards investment.
Hugo Llewelyn, CEO, Newcore Capital, said: “These acquisitions represent a continuation of our longstanding investment approach; investing in assets that serve essential societal needs and are thus resilient to the cyclical nature of capital markets, major economic shocks, and the deflationary effects of technological innovation.
“Our sole focus on social infrastructure real estate combined with risk-averse capital stewardship has delivered consistently strong returns to our investors – an 11.4 % aggregate IRR since inception to June 2023, notwithstanding the overall falls in the wider capital markets.”
Harry Savory, Chief Investment Officer at Newcore Capital, said: “This is an increasingly attractive environment to be actively acquiring, albeit one to be aware of assets with unsustainable dynamics. We have purchased these assets with a good degree of confidence in their potential returns, thanks to our deep-rooted networks within the social infrastructure sectors and regionally in Greater London and the Southeast of England.”
Earlier this year, Newcore raised £190m for its latest value-add fund. Investors included the Merseyside and Clwyd local government pension schemes, a FTSE 100 pension fund, family offices and high-net-worth individuals.
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