NewRiver REIT boosts capital partnerships business with acquisition

NewRiver REIT has acquired an asset management business, boosting its capital partnerships business to £1.5bn across a portfolio of 21 shopping centres and 18 retail parks, with 13 different partners.

The company has bought Ellandi Management Limited, an asset and development management business focused on UK retail and regeneration, for £5m.

The Ellandi business brings with it a portfolio of 16 shopping centre asset management mandates, covering over 6.3 million sq ft, with 10 different partners. The two co-founders and owners of Ellandi, Morgan Garfield and Mark Robinson, will join NewRiver as head of capital partnerships and head of regeneration, respectively, while both will also join NewRiver’s executive committee. 

During the year ended 30 April 2024, Ellandi’s fee income was £5.7m and EBITDA was £1.1m. An additional cash consideration of up to £4m will be paid by NewRiver subject to EBITDA performance, including realising savings through shared services, over a three year earn out period.

NewRiver said that the acquisition aligns with its strategy to expand its capital partnership business over the medium term, where it manages retail real estate assets for landlords (such as pension funds). The combined capital partnership business will have significantly increased scale, with assets under management (AUM) of £1.5bn across a portfolio of 21 shopping centres and 18 retail parks, with 13 different partners. Including NewRiver’s wholly owned portfolio of retail assets, this increases AUM to £2.0bn across a portfolio of 44 shopping centres and 29 retail parks and an existing fee income stream of £8.2m.

Allan Lockhart, chief executive of NewRiver, commented: “The acquisition of Ellandi supports our ambitions to expand our Capital Partnerships business and grow its fee income. We have watched the impressive growth of Ellandi over the last 16 years, despite limited capital resources, which has been in no small part due to the entrepreneurial energy and expertise of Morgan, Mark and their team.

“We believe there will be considerable opportunities in the retail real estate market to accelerate the growth of our business from this point. By bringing together two high-quality teams with complementary skills and experience in asset management and regeneration, together with the balance sheet resources we have available, we are well positioned to participate in these opportunities, both on the balance sheet and through Capital Partnerships.”