By David Ingham
Investors in US Office Properties III will make their money mainly on the rental income from buildings in the portfolio.
Investcorp, the Bahrain-based investment group, has launched a new real estate investment fund, US Office Properties III. The product allows investors to share in the rental income from buildings in three business and commercial centers in the USA.
The portfolio includes nine office buildings and two retail facilities in three locations: the Broward Financial Center in Fort Lauderdale, Florida; Westport Plaza in St Louis, Missouri; and the Broadway Portfolio in the New York Metropolitan area.
Collectively, the properties are valued at $273.7 million and their combined occupancy rate is approximately 90%.
Investcorp will take care of the leasing of vacant space, the renewing of existing tenancies and the reduction of operating costs. It will also oversee the sale or development of excess available land.
Investor returns will come primarily from the cash generated by rental income, with an opportunity to benefit in case of the outright sale of the buildings in the portfolio.
“Investments in commercial real estate in the United States perform consistently in a sector which traditionally eschews volatility,” says Gary Long, Chief Operating Officer, Investcorp.
“Published statistics show that in the last 70 years, the US real estate market has declined in value on only three occasions.
"Such investments meet our investors’ demands for a diversified range of alternative investment products that involves spreading risk as well as seeking enhanced returns. Real estate reinforces our ability to satisfy all their alternative investment needs.”