Property First launches repossessions fund

Property First Asset Management has launched UK Property Recovery No 4 LP, a bespoke fund focused on acquiring property that has been reposed or is under threat of repossession.

The target return on the fund is 15% per annum and the primary objective is capital growth and income. It is open for investment in September.

The fund’s acquisition team believes this is the best time to buy UK property in the last 40 years and is currently working with banks, building societies, receivers and professional introducers.

Matt Staines, senior partner at Property First AM, says: “Many investors believe successful property investment is all about Location, Location, Location. The acquisition team at Property First Asset Management believes it is all about Timing, Timing, Timing."

He believes the current cyclical phase has been brought about by sub-prime lending in the USA and a sudden correction in UK market values. This has led to a crisis in the banking system which has in turn led to difficulties in obtaining higher loan-to-value mortgages.

“There is no doubt that we are in a falling market – and who knows how far the market will fall.”

The company is in negotiations with banks and building societies that have been sent keys after certain investors have panicked.

“Our view is that this is probably the worst time for a bank or building society to hold a portfolio of repossessed property. Therefore they must sell in order to crystalise a loss and then take steps to strengthen their balance sheet.”

UK Property Recovery No 4 LP is a three to five year closed-end fund eligible to SIPP, SSAS and private equity investors. While there is a £5,000 minimum investment for SIPP and SSAS investors, there is a £20,000 minimum for private equity.

For more information, adviser can contact: 0800 783 6266 or info@propertyfirstassets.com.