Alternative Income REIT (AIRE) has appointed M7 Real Estate as its new investment adviser.
AIRE, which owns a diverse portfolio of 19 UK commercial property assets let on long leases, has made the appointment after the previous manager departed in February.
M7, which is a leading specialist in the pan-European, regional, multi-let real estate market, will undertake a review of each of the group’s assets and the company’s investment policy.
It has initially been appointed until 31 March 2021, with a view to a longer term agreement.
M7 will provide the AIRE with advice, support and services including strategy, debt advisory, reporting, fund accounting and investment advisory services together with asset management, operational advice, budgeting and planning for the group’s portfolio.
M7 will have delegated authority to act within defined parameters and where decisions outside pre-approved criteria are required, specific approval will be agreed with the company.
AIRE said it hopes to achieve a narrowing of the company’s discount and, in time, attract new investors.
M7 has over 200 employees in 14 countries across Europe, including 120 in the UK. The team manages over 830 properties with a value of €5bn for clients including some of the world’s largest real estate investors such as Blackstone, Oaktree, H.I.G. Capital and Starwood Capital.
M7 will be paid an annual fee of 0.5% of the company’s net asset value paid quarterly in advance, subject to a minimum fee of £90,000 per quarter from 1 October 2020. Until 1 October 2020, there is no fee payable.
[QD comment: This is a very impressive appointment by AIRE. M7 is a very well regarded in the property world as a first rate asset manager and has achieved an average geared internal rate of return of 22.6% per annum since it was founded in 2009 for the UK investment vehicles it has fully exited. M7’s strength is in its utilisation of technology. Its Coyote information and data management system, which it developed in-house and subsequently commercialised in 2018, tracks individual properties or portfolios of properties from introduction to acquisition (or rejection), allowing M7 to collect proprietary data on more than 15,000 assets across the UK and Europe. It will be interesting to see the outcome of M7’s review and the future direction AIRE takes.]
AIRE : Alternative Income REIT appoints investment adviser