Benson Elliot and Stanhope Join Forces with Sackville Properties to Take Forward £400 Million Station Hill Re-development in Reading

Benson Elliot Capital Management (“Benson Elliot”), the leading private equity real estate firm, and Stanhope plc (“Stanhope”), one of the UK’s most experienced developers, have acquired a majority interest in the company established by Sackville Properties for the landmark Station Hill re-development in Reading. Alongside the £850 million upgrading and enhancement programme at Reading Station, the first phase of which will be completed in 2013, the Station Hill development is the centrepiece of plans to renew the heart of Reading, and reinforce the town as the capital of the Thames Valley.

Sackville Properties, under the leadership of Chairman Sir John Madejski, initiated the Station Hill project, acquiring the main portion of the site from Land Securities in 2005. Sackville extended the site through further land acquisitions before securing a resolution to grant planning consent for a 1.7 million square foot mixed-use project in 2009. More recently, Sackville has been looking for a funding and development partner to secure the resources and experience required to bring forward the re-development of the site.

Stanhope, led by David Camp, is recognised as one of the most experienced developers of large-scale urban projects in the UK, with a track record encompassing landmark projects such as Broadgate and Chiswick Park. Benson Elliot founder Marc Mogull has led the funding of urban regeneration projects across Europe during the past twenty years, and is the UK Chairman of the Urban Land Institute, the pre-eminent global land-use organisation. The Station Hill transaction represents the first investment for the €500 million fund, Benson Elliot Real Estate Partners III.

Sir John Madejski, Chairman of Sackville, said: “I am delighted that the formation of this exciting partnership, and the injection of new capital at a time of financial constraint, will give renewed impetus to the re-development of this key site in the heart of Reading. It has long been my ambition to see the epicentre of Reading brought back to life; it is without doubt the most important development in the South East of England.”

David Camp, Chief Executive Officer at Stanhope, added: “There is a tremendous opportunity here to make a meaningful and important contribution to the resurgence of Reading. The Sackville team has assembled a first class site, and we are looking forward to building on its work to create a new superbly located and connected place in which to live and to work.”

Marc Mogull, Managing Partner at Benson Elliot, commented: “This is a significant urban regeneration scheme, and Benson Elliot is excited to be part of it. I look forward to working closely with Reading Borough Council, Sir John and the talented teams at Stanhope and Sackville to see it realised.”

Cllr Andrew Cumpsty, Leader of Reading Borough Council said: “I am extremely pleased to learn of the announcement of this joint venture. It is an important milestone in this critical development project for the town. Station Hill is a key location in the town centre and its development, along with the investment the Council has secured in the area around the station, will transform one of the major gateways into Reading, providing a real boost to our already powerful local economy and supporting the priority we give to civic aspiration.”

Strutt and Parker acted for Sackville Properties on the transaction whilst Savills acted for Benson Elliot and Stanhope.

 

For further information:

Benson Elliot
Marc Mogull, Managing Partner
Phil Irons, Partner
+44 (0) 20 7808 8900

Financial Dynamics 
Dido Laurimore / Stephanie Highett / Will Henderson
+44 (0) 20 7831 3113
dido.laurimore@fd.com

Stanhope
Charles Briscoe, Director
+44 (0) 20 7170 1700

Sackville
Jon Homan, Director
+44 (0) 118 958 4459

 

About Benson Elliot

Benson Elliot was founded in 2005 to realise a vision for successful real estate investing in a changing market environment. Conceived alongside a group of leading institutional investors, the firm is dedicated to delivering sustainable investment out-performance through market cycles. The firm launched its inaugural investment vehicle, Benson Elliot Real Estate Partners II, L.P., in April 2006, closing in August 2006 with commitments of more than €335 million. Benson Elliot Real Estate Partners III, L.P., closed in 2009 with commitments of over €500 million. All funds managed by Benson Elliot are fully discretionary.

Benson Elliot is led by Marc Mogull and Trish Barrigan. Mr. Mogull established, and for seven years managed, the Doughty Hanson & Co European Real Estate Fund. In this role he was responsible for the acquisition in 2001, and subsequent re-development, of Broad Street Mall in Reading. Ms. Barrigan was previously Managing Director and Head of Global Real Estate Investments for Dubai Investment Group, moving from Goldman Sachs where she spent ten years primarily in principal investing and portfolio management for the Whitehall Funds.

The Benson Elliot team includes senior industry professionals with experience in sourcing, underwriting and managing real estate investments across Europe and across all major property sectors. Benson Elliot’s UK team is led by partner Phil Irons, who was previously Head of Transactions for UK fund manager Schroders. During his tenure at Schroders, Mr. Irons executed c. £1 billion of acquisitions and dispositions in the UK. Previously, Mr. Irons was Head of Acquisitions and Dispositions for the London Stock Exchange-listed property company Benchmark Group.

Highlighting the firm’s successes Private Equity Real Estate named Benson Elliot “European Emerging Firm of the Year” for 2006. In 2008, Private Equity Real Estate named the firm as one of ten emerging managers globally it expects “to shape the private equity world around them.” Benson Elliot was further honoured by its peers with the 2009 European Fundraising of the Year (Private Equity Real Estate).

About Stanhope

Stanhope PLC is a property development company with over 25 years experience. The company is 65% owned by the management of the business many of whom have been together for over 20 years. As developers, development partners and development managers the company has been wholly or jointly responsible for the delivery of over 20 million square feet receiving well over 100 awards for development design and construction excellence.

Stanhope PLC is perhaps best known for its many City of London commercial schemes such as Broadgate and Paternoster Square and arts projects such as The Royal Opera House and Tate Modern. The City continues to be a key market for the company although increasingly it has been associated with regeneration projects throughout the United Kingdom such as Hereford City Centre, Stevenage, Ashford, Croydon and Stevenage.

Joint venture and partnerships are central to Stanhope’s philosophy and over the years they have worked with a number of strong, long term financial partners including, The Crown Estate, Legal and General, Schroders, Aviva and British Land.

At the heart of all of Stanhope’s projects is a belief that by place making and creating new sustainable environments that meet the needs of existing and future occupiers, they create the best possible long term investments and ensure the long term success of the location.

About Sackville Properties

Sackville Property Management Limited is the management company for a group of property investment and development companies, which was formed in November 2006. Other related companies are involved in property investment and development.

The predecessor company, Sackville Properties PLC, was formed in March 2001.

The Chairman and major shareholder is Sir John Madejski OBE DL and the Executive Directors are Michael Bracken and Jon Homan, who have extensive and wide ranging experience in both development and investment and Ian Smith, Finance Director. The other Board members are Nigel Howe, Chief Executive of Reading Football Club and Ian Wood-Smith, Senior Partner in the law firm of Field Seymour Parkes in Reading.

Following the sale to Hilstone, in March 2005, Sackville’s newly formed subsidiary, Sackville Developments (Reading) Limited, purchased a portfolio of properties in central Reading, from Land Securities and subsequently adding to these with further acquisitions. The site, which totals 5.1 acres, includes two office buildings totalling 127,000 sq.ft., thirteen shops, a former Mecca bingo hall, the former Friars Walk Shopping Centre and a multi-storey car park let to NCP. The site has potential for redevelopment as a mixed use scheme and, being sited immediately adjacent to Reading Railway Station, will become a landmark gateway to Reading. A mixed use development totalling approximately 1.72 million sq.ft was granted planning permission in February 2010. This has now been incorporated into a new joint venture with Benson Elliot Capital Management and Stanhope plc.

In December 2005, Sackville Developments acquired a 52 acre site adjacent to Junction 15 of the M40 at Warwick from Severn Trent, for a 750,000 sq.ft. Business Park. Construction of the first phase of office buildings totalling 62,000 sq.ft. has been completed and a further 12,000sq ft has been developed for Geberit Limited This acquisition was funded through a structured finance package with The Royal Bank of Scotland plc.

Sackville also acquired a 12.5 acre site at Egham, Surrey, close to Junction 13 of the M25 and developed a 40,000 sq.ft. Headquarters office building known as Milton Park which they subsequently sold to Belron plc.

In parallel with the development activities, Sackville also operates a property investment group which currently holds a portfolio of 9 properties, both commercial and industrial throughout the UK.

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