Swiss groups benefit as Allied Irish agrees Polish property sale

Two private market investors with bases in Switzerland are set to boost their Eastern European property fund management operations after Allied Irish Banks agreed to sell its Polish property fund subsidiary and interests in two regional funds.

Partners Group and Peakside Capital will share in the disposal, in a sign private market groups stand to be beneficiaries as troubled European banks scale down their property asset management activities by selling whole portfolios, not just individual, troubled loan books.

Peakside, a private equity property investor bought out of Bank of America Merrill Lynch by its managers in 2010, and whose European network range from Switzerland, to London and Luxembourg, will acquire AIB’s Polish property fund management subsidiary, AIB PPM, for an undisclosed sum.

AIB is also selling its remaining interests in two property funds – a 9.87% stake in Polonia Property Fund LP and a 7.5% stake in Polonia Property Fund II Limited – equally between Peakside and Partners Group, a diversified private asset management group based in Switzerland.

The sales are expected to close during the third quarter of 2012.

Partners Group already has about €3bn invested in private real estate assets, and $1bn invested in private real estate secondaries, according to its website.

Peakside will add the assets to its growing realm of activity in central and eastern European property, including deal origination and execution, asset management and fund management services.

It has two real estate funds, namely the pan-European opportunistic Peakside Real Estate Fund I, and the Turkish Bosphorus Real Estate Fund I, plus direct property investments, spread across more than 15 countries.

One of Peakside’s founding partners Roger Barris said last year the group was interested in distressed property investments being sold by European banks that were trying to clean up their balance sheets.

Of Ireland, he told IP in October: “We have seen what happens when you try to clean it up overnight: the answer is national bankruptcy. But conversely, as they recapitalise, as they generate earnings, they are going to take those as opportunities to clean up their balance sheets.

“It’s going to be a long, drawn-out process, but it’s going on and there is enough of it happening that we are seeing interesting opportunities.”

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