Sir Tom Hunter, Nick Leslau, HBOS and Baugur, the Icelandic group, have each committed up to £100m. Further capital has been raised from other investors including Leslau’s business partner Nigel Wray. With bank borrowing, the fund’s spending power will top £2 billion.
Leslau has been one of the property market’s most active private investors, trading several billion pounds worth of property. He has been a big winner of the recent bull market, but for the past year he has taken a more cautious stance towards the sector, believing that in some areas, particularly in secondary property, it has become overheated.
There is no rush to spend the £500m that has been raised, but the capital could be deployed to acquire undervalued corporate assets. Both Hunter and Leslau were involved in the acquisition of Wyevale Garden Centres.
HBOS’s joint-venture arm is one of the most active lenders to the property sector. It also has a track record of taking equity stakes when it likes the management teams.