Centrepoint Asset Management will acquire asset portfolios from administrative and fixed-charge receivers and has raised £100m in debt and equity, supported by syndicated lenders acting for private equity firms, investment banks and private wealth offices.
The venture has been developed to satisfy the mid-market price point between £5 million and £100 million, where assets are tricky to dispose of due to unwieldy corporate structures.
Julian Sampson of Guildford-based law firm Wright & Wright, is acting on behalf of Centrepoint.
He said: "It was becoming apparent that this mid-tier market has been left largely unrepresented by funds which are either focusing on the larger bank or government-led disposals or are becoming increasingly sector-focused, on student accommodation, for example.
"Insolvency or assisted disposals are typically part of a reactive process and IPs and receivers have to work with whatever they are handed.
"This could mean they are often inclined to disclaim assets or put them into asset management for a disproportionately lengthy period of time whilst they unravel matters."
Centrepoint’s research found it is not uncommon for sizeable portfolios to consist of a single commercial unit plus 200 residential units.
Sampson added: "Typically a buyer will want to cherry pick the valuable asset and leave the rest blotting the receiver’s copybook."
Centrepoint’s approach is to bid for entire portfolios, therefore building relationships as a performer that, in turn, supports the selling representative that it deals with.
Wright added: "What frustrates our Clients are the multitude of purported mandated agents acting in this market, often extracting sizeable fees that might otherwise have benefited the creditors.
"This ‘off-market’ market is impossible to value but it is not uncommon for brokers to charge 5% for a simple introduction, often bundled up as a ‘buyer’s premium’."