Tadhamon Capital Exits UK Coxlease School Investment With Net Profit of 60%
Tadhamon Capital BSC announced the successful exit from its investment in Coxlease School in Lyndhurst, Hampshire UK.
The School is a specialist residential education facility for children aged 9 to 19 with severe behavioral, emotional and social difficulties (BESD). The School is let to Priory Group, a leading provider of behavioral care in the UK, for a 30 year period with annual rent reviews linked to the Retail Price Index (RPI).
Acquired in November 2010, the School was Tadhamon’s seed investment in its Social Infrastructure Investment Platform in the UK. The platform currently holds assets valued at over £350 million ($523 million) across segments including student housing, education facilities, elderly care and retirement homes and social housing.
Over the five year investment period, a minimum annual cash dividend of 9% was distributed quarterly to investors. The investment achieved a total return on capital exceeding 60%, translating to an Internal Rate of Return (IRR) of over 12%.
Mr. Hesham Al Gassab, Executive Director of Investments at Tadhamon Capital, said, “Tadhamon Capital strongly believes in the UK’s real estate market, where over the last several years we has established a strong track record of investing. We have successfully built up our Social Infrastructure Investment Platform sourcing investment opportunities capable of achieving attractive annual returns for investors ranging from 6 - 9% per annum and IRRs reaching 25%.”
Mr. Al Gassab added, “Over the last wo years in particular, UK real estate values have risen considerably as a result of the surge in international institutional capital flowing to the market. This has made it increasingly challenging to achieve our targeted returns. We believe 2016 is going to be an even more difficult year forcing us to shift our focus in the UK to more opportunistic transactions. We are currently looking to the residential market, targeting development opportunities either in the pre or post planning phases within Central & Greater London locations where we still see potential for capital appreciation. We will also be focusing on more value added investment opportunities where, with active asset management on the part of our experienced team and partners, capital value can be unlocked.”
Also commenting, CEO of Tadhamon Capital, Mr. Ahmed Sultan, said, “Despite the impact of geopolitical events and low oil prices on regional and global markets, Tadhamon Capital is well placed to continue to identify and offer compelling opportunities to GCC investors who are increasingly looking for portfolio diversification, steady and attractive returns and wealth preservation. To meet this demand, we are maintaining our focus on introducing new Shariah compliant investment opportunities in the UK and other developed markets through which we are confident in our ability to deliver value for our investors and shareholders alike.”