The two firms have agreed to partner for a four-year project which will develop and manage UK real estate sites, as well as acquiring sites with change of use potential.
The joint programme will tap Palmer Capital Development Fund III, a £73m fund which consists of equity from CBRE GMM plus co-investment and £3.65m from Palmer, with a second close likely to go ahead in the future.
The four-year plan will see both CBRE GMM and Palmer Capital members sit on the investment committee, with the management for the projects then taken on solely by Palmer.
Palmer Capital’s second development fund’s investments included a 14,000 square ft office near the Savoy Hotel which was bought for £8.75m in 2012 and is currently being converted into £23m luxury apartments.
The fund has achieved 15.2 per cent IRR for the last 12 months, 14.8 per cent for two years and 13.4 per cent IRR for the last three years.
Fund manager Chris Button said, “GMM have backed us in large part because of what we have done in the PCDF funds, and because of the strong relationship this has helped us form.”
GMM invested in both of Palmer Capital’s previous development funds which followed a similar strategy.
Palmer Capital chief executive Alex Price said, “We have a track record of picking market themes, and we currently see the broadening of the economic recovery across the UK and growing occupational demand.”
The first and second deals for Fund III are tipped to be completed this week and next week respectively.
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