LONDON (Alliance News) - First Property Group PLC said that it has partnered with clients of a global investment business, to convert office buildings in the UK into residential properties.
The commercial property fund management company did not name the clients or investment business, but said that it is a closed ended partnership, with a life until May 2018.
First Property said that the clients of the investment business will initially commit GBP12 million,with an intention to increase the amount to GBP40 million within three months.
It said that it has agreed to commit 5% of the total equity raised, within a limit of GBP2 million.
It also said that it will manage the partnership, but will not levy any fees for its services, as it will instead be paid 20% of the profits earned by the partnership.
"There is a housing shortage in the UK and our plan to convert redundant offices into housing makes a great deal of sense... this new partnership broadens the Group's institutional sources of capital, " said Group Chief Executive, Ben Habib in a statement.
First Property shares were trading 3.3% higher at 23.89 pence per share Thursday morning.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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First Property (FPO)