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Legal & General’s Principal Balance Sheet Businesses Accelerate Real Estate Disposals: £1.1bn Transaction Volume in 2017 To Date
Legal & General Capital (LGC) and Legal & General Retirement (LGR), have executed a record £1.1bn of real asset disposals in 2017 to date, of which approximately £1bn has been to international investors.
24 Oct 2017
Legal & General’s real asset strategy combines skillsets and portfolios in LGC and LGR, alongside LGIM Real Assets. Legal & General’s principal balance sheet businesses, Legal & General Capital (LGC) and Legal & General Retirement (LGR), have executed a record £1.1bn of real asset disposals in 2017 to date, of which approximately £1bn has been to international investors. Legal & General’s share of gross proceeds from these transactions has been £526m.
Legal & General Retirement’s (LGR’s) recent sale of 70 Gracechurch St delivered gross proceeds of £272m as part of its active management of the asset portfolio backing its annuity liabilities.
In addition, Legal & General Capital (LGC) generated gross proceeds of £254m from transactions with a gross value of £817m (see table below). All full asset disposals met or exceeded targeted returns of 10-12% IRR.
| Transaction | Gross proceeds (£m) | Ownership share (%) | LGC share of gross proceeds (£m) |
|---|---|---|---|
| *Partial sale / distribution | |||
| Cardiff – 1 Central Square | 51.0 | 100.0 | 51.0 |
| Cardiff – 2 Central Square | 56.5 | n/a | 38.0 |
| Piccadilly, London | 52.0 | 100.0 | 52.0 |
| Bracknell Car Park | 39.7 | 50.0 | 19.9 |
| Arlington Business Parks Partnership | 443.2 | 7.8 | 33.9 |
| Bishopsgate Property Fund* | 84.9 | 25.0 | 21.2 |
| Access Development Partnership* | 22.0 | 50.0 | 11.0 |
| NTR Wind 1 LP* | 29.8 | 47.5 | 14.1 |
| Pemberton Funds* | 37.8 | n/a | 13.0 |
| Total | 816.9 | 254.2 |
Proceeds are being reinvested alongside other Legal & General funds in our substantial UK regeneration programme. Many UK cities and towns are regenerating themselves successfully in partnership with Legal & General.
The successful LGR/LGC business model, established four years ago, is now at a point in its development where investments can either be manufactured within the business to suit specific needs or recycled into new opportunities.
Nigel Wilson, Legal & General CEO said: “Strong demand from international buyers demonstrates that the UK is a great place to invest. Having invested £12bn to date, we are on track to invest £15bn of long-term capital in UK housing, urban regeneration, clean energy and business growth.”
Further information
Olivia Bayliss
Head of Communications
Capital and LGIM Real Assets
Notes to editors
Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with £1.2 trillion in total assets under management (as at FY23) of which c40% (circa £0.5 trillion) is international.
We have a highly synergistic business model, which continues to drive strong returns. We are a leading international player in Institutional Retirement, in Retail Savings and Protection, and in both public and private markets through our Asset Management division. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.
As at 7 June 2024, we estimate the Group’s Solvency II coverage ratio to be 224%.
As at 11 June 2024, Legal & General has a market capitalisation of £14.6 billion.