Bayside goes for equity in first JV deal

Private debt firm Bayside Capital's joint venture with property specialist Bauer Group has completed its first deal, acquiring a portfolio of 15 commercial properties in the UK in an all-equity deal which will be refinanced at a later date.

HIG Bauer Property, a joint venture between HIG Capital credit affiliate Bayside Capital and private asset manager Bauer Group, has completed its first deal with the purchase of 15 UK commercial properties, according to a statement. The deal is unusual for Bayside, which normally invests in debt, in that it has provided equity for the deal through the JV. This was due to timing issues, according to director Chris Zlatarev. 

After acquiring the properties in an all-equity deal, the Bayside and Bauer team will look to bring in debt financing from traditional lenders in due course. Zlatarev said that with this type of debt, Bayside would look at an LTV of 50 percent over a five year term.  

The firms hope to deploy around €100 million of capital over the next three years through the JV, Zlatarev added.

The properties, nine of which are office buildings and six light industrial, were purchased as part of a wider strategy to target high yielding commercial multi-let assets in the UK. 

Ahmed Hamdani, managing director at Bayside Capital, said: “We are excited about the opportunities available in the UK market and pleased to be partnering with Bauer Group on this strategy. The purchase underlines Bayside Capital’s capability to quickly execute transactions in a complex asset class. This transaction demonstrates HIG’s commitment to the UK market and to growing its European real estate and NPL business further”.

David Reed and Jeremy Oldroyd, Bauer Group’s joint chief executives, added: “This is a hugely important transaction for Bauer Group. We see substantial opportunities in the UK regional commercial property markets and to create a joint venture with an organisation such as HIG is very exciting for us.”