AEW’s UK core-plus property fund acquires Northgate House in Reading | News

Asset manager AEW has acquired a 66,000sqft town centre office building in Reading on behalf of its UK core-plus property fund.

The manager’s AEW UK Core Plus Property Fund has invested £8m (€9.4m) to buy Northgate House on Valpy Street from a private property company. The office building is occupied by a government department.

The acquisition forms part of AEW’s strategic site assembly, adding to its existing ownership of Tangent House and a public house to the rear of Northgate House, creating a highly prominent site in a location lending itself to multiple end uses. 

Michael Shears, executive director at AEW, said: “The acquisition of Northgate House is in line with the fund’s investment strategy of acquiring assets in core locations which are underpinned by long-term, strong capital values with optionality in viable end use.

”Northgate House sits on a gateway site in Reading town centre in a market with limited new delivery of grade-A office space.”

In May last year, AEW changed the investment strategy of its UK Core Property Fund to core-plus and increased its maximum leverage capacity to 30% of the value of the fund’s total assets. The fund was renamed the AEW UK Core Plus Property Fund.

At the time the manager said the fund “will seek to capitalise on market inefficiencies and acquire attractively priced and high-quality multi-sector commercial real estate at the margins of prime locations across the UK”, with the aim of achieving “superior investment returns over the long term”.

The strategy focuses on strong stock selection and identifying properties with high income streams and the potential for active asset management to increase capital value.

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