Who we are Victorios Investment Management (VIM), a London based company, is a specialist in single tenant, long term real estate investments, focusing specifically on sale-leasebacks, build-to-suit/development financing and direct net lease acquisitions. VIM has a significant track record working with a number of prominent global brands. We add value to our clients by working directly with investors and other sources of capital that specialise in the net lease real estate sector across Europe, US and Asia. We pride ourselves on our openness, transparency, connectedness and our drive. Our partners have over 30 years of combined experience in European commercial real estate. Over the last six years we have exclusively focused on the net lease sector where we have worked with a number of prominent occupiers, developers and investors.
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“AS SPECIALISTS IN THE SINGLE TENANT LONG TERM INCOME REAL ESTATE SECTOR, THE TEAM AT VICTORIOS UNDERSTAND HOW TO BEST STRUCTURE THESE TRANSACTIONS FOR THE BENEFIT OF ALL PARTIES. THEIR PERSONABLE ATTITUDE AND SOLUTION-FOCUSED EXPERTISE PROVIDE AN INVESTOR, DEVELOPER OR OCCUPIER WITH THE NECESSARY SUPPORT TO HELP MAKE SURE THE TRANSACTION HAS A SUCCESSFUL CLOSURE.” Gordon F. DuGan Chief Executive Officer Gramercy Property Trust
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What we can offer VIM represents a variety of capital sources specialising in long term real estate investments. VIM works directly with corporate occupiers, developers and investors to fulfil their individual needs and ensure their long term goals are exceeded.
From an investor’s perspective VIM can provide a reliable exit to a previous investment or development, helping them to reach their required returns.
From a corporate occupier’s perspective VIM can help unlock the true potential of their business by bringing together real estate and business financing. Through both sale and leasebacks and build-to-suit development financing VIM provides the opportunity for them to grow their operations.
With an extensive range of capital sources and a proven track record, VIM has worked with a number of established investors and helped some of the largest real estate developers and corporates in a variety of sectors gain the full potential of real estate financing.
From a developer’s perspective VIM can provide equity financing for their single tenant long leased developments ensuring minimum risk throughout the construction process.
VIM manages all pre and post-closing processes to match and exceed set performance targets and ensure our client’s interests are protected.
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How Can a Net Lease Investor Help You? Sale-leasebacks Provides owner-occupiers with a long term source of business finance by allowing the company to release capital tied up in real estate, without increasing their debt exposure or diluting their equity.
Build-to-suit and development financing Helps both owner-occupiers expand their operations and developers construct their single tenant mandates by providing an all equity financing source.
“WE ARE A COMPANY THAT OWNS A LOT OF REAL ESTATE AND CONSTANTLY LOOK AT WAYS TO GROW OUR BUSINESS. THE SALE OF LOGISTICS AND SUPERMARKET ASSETS, HAS ENABLED US TO RELEASE CAPITAL TO INVEST IN OUR GROWTH. VICTORIOS HAS BEEN INSTRUMENTAL IN HELPING US WITH THIS.”
Piruska Canjuga Member of the Board, Executive Vice President for Business Development Agrokor Group
Direct investments (for investors) Provides real estate investors with a credible and reliable exit from their single tenant holdings.
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Sale-leasebacks Sale-leasebacks are a reliable source of long term financing for a business, providing companies with a credible financing partner without increasing their debt exposure or diluting their equity position. Real estate financing – Sale/Leasebacks 1. VIM Capital
Asset acquisition/ development cost
2. Occupier
Asset sale
VIM Capital
Long lease
Occupier Rent
Some of the key benefits of sale-leasebacks as a financing alternative include: 1. Sale-leasebacks are a good way to finance operations when there is no debt in the markets and when companies do not want to dilute their equity. As opposed to mortgage refinancing when up to 60-70% of the asset value can be capitalised, a sale-leaseback allows for the extraction of 100% of property values. 2. Sale-leasebacks are a good way for companies to benefit from the arbitrage between the corporate multiplier (p/e ratio) and the property multiplier which is generally higher. This can be particularly attractive for real estate rich companies which are in the process of/ or are expected to be part of a corporate takeover or merger. By selling their real estate before selling the company, the total capital received will be higher than by simply selling the company with the real estate on the books. 3. For non-real estate focused businesses there may be an inherent opportunity cost of holding real estate on their books. A company’s core business is likely to return more than the going market yield for the real estate it holds on its books. Therefore by investing the proceeds of the real estate back into the business, the return on the capital invested is higher.
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4. There may be tax efficiency arguments that support renting in favour of owning the space a company operates from. Firstly, rent is a tax deductible expense. Secondly, accounting practice requires core operational real estate to be kept at book value in the balance sheet, which can differ from market value. When this is sold, there can be a one off loss or gain which will enter the profit and loss statement. 5. Sale-leasebacks allow companies to maintain full operational control of the real estate. A sale-leaseback transaction can be structured in such way that, with the exception of paying rent, it will have no impact on the company’s operations or long term strategy. 6. Capital raised through sale-leasebacks may be used to pay down debt and hence reduce higher costs of borrowing while allowing the company to reinvest in higher yielding core activities. Crucially, sale-leasebacks are subject to a careful due diligence and market research process to ensure all elements of the transaction are market-proof, including rental levels and hence returns.
Build-to-suit transactions and development financing Build-to-suit transactions and development financing provide companies that are looking to expand, and real estate developers working with these companies, with a credible and reliable long-term source of financing. Real estate financing – Build-to-suit 1. VIM Capital
Full development financing
2. Occupier
Development sale
Build to suit investors provide corporate occupiers with the crucial capital required to finance real estate (and therefore company) expansions in the case there is no debt in the market, or when they are unable or unwilling to finance through their own capital. Working with our investors’ capital VIM provides a platform to finance the build-to-suit. VIM works closely with all parties involved (corporate occupier, developer and our investor) to ensure that the needs and long terms goals are met and a suitable finance structure is put in place. This brings the following benefits to the different parties:
VIM Capital
Long lease
Occupier Rent
Investor - a long term partnership as a landlord with the corporate occupier and a secure cash-flow (from the rent) providing attractive risk-adjusted returns. Developer - a de-risked position due to not having to fund the development and look for an exit. Corporate Occupier - a refurbished or brand new operational space built to their specification without any upfront expense, therefore allowing their business to grow. The end result is the creation of an enhanced workspace solution, and an environmentally efficient building that reflects the ethos of the occupier in what is a cost effective option for a company looking to grow.
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Direct acquisitions Through Direct acquisitions VIM targets investors holding a net lease investment. VIM can provide them with a reliable source of capital and thereby allow them to maximize their real estate returns by providing a credible exit strategy. VIM targets long term investments with stable cash flow and can work together with current investors to proactively asset manage their holdings and mould them into a saleable asset for VIM capital.
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“TO DATE VICTORIOS HAS WORKED WITH US TO DEVELOP STANDALONE BUILD-TO-SUIT PROJECTS AND DELIVER SALE-LEASEBACK SOLUTIONS FOR OUR LARGER CORPORATE CLIENTS. THEY OFFER A PROACTIVE, SOLUTION BASED APPROACH AND GOOD ACCESS TO CAPITAL.”
Ben Bannantyne Managing Director & Regional Head CEE Prologis
The benefit of off-market transactions VIM encourages a low-key transaction process and favours off-market deals. These have a number of benefits relative to transactions that are subject to a full marketing process: • For direct acquisitions, the subtlety of offmarket transactions ensures the impact on tenants is minimized and the seller’s relationship with tenants is not affected; • Any sensitivities there may be of the market knowing of an owners desire to sell are removed by dealing quietly and off market; • Off-market transactions allow sellers more control over the number of people passing through the property, thereby minimizing potential disruption to business operations; • For owner occupiers looking for saleleaseback financing, off-market transactions minimize the potential negative impact of employee and staff involvement;
• Off-market processes reduce brokerage fees by removing an additional cost layer (no sales agent), reduce timing (through reduced marketing efforts), and costs (through reduced and strictly targeted marketing and promotion charges and through the removal of excess pre-marketing procedures); • By removing excess layers of intermediation (sales agents), off-market transactions lead to a more transparent, direct and open negotiation process between the seller and the buyer, thereby maximizing the success of closure while safeguarding market best practice by ensuring market norms are followed (valuations and appraisals).
• In the case of build-to-suit transactions, offmarket processes can offer significant time savings, reducing the volume of parties involved (developer, project manager, contractor etc) and therefore allowing for a shorter period to completion of development;
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Our role Sourcing • Off-market opportunities • Direct involvement between corporate occupiers to ensure operational targets are safeguarded • Provide access to diverse capital sources • Identifying expansion needs Structuring • Asset and/or corporate transactions • Individual or portfolio acquisitions • Coordinate with advisory and legal teams Delivery • Secure, long term capital source • Coordination of full DD process Asset Management • Proactive approach with occupiers, investors to understand and help achieve performance • Lease extensions • Real estate expansions • Refurbishment • BTS coordination and supervision Long Term Financing Partners • Providers of long term business finance • Repeated transactions • Understanding of real estate needs and key business fundamentals
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Track record
“AS A LARGE CORPORATE, WE ALWAYS LOOK TO WORK WITH BEST IN CLASS, I HAVE KNOWN WARD STOCKER, ONE OF THE PARTNERS AT VICTORIOS FOR OVER A DECADE”
We have extensive experience negotiating sale-leaseback and development financing transactions having acted on behalf of major US investors active across Europe. Over the past six years we have sourced and transacted a number of sale-leaseback and development financing transactions and have developed a very strong network with some of the major corporates, developers and investors in the market together with banks and due diligence teams. These include Tesco, Renault, DHL, Sanmina, Visteon, Diebold, H&M and Agrokor.
Estelle Graur Renault Real Estate
Our recent transactions Asset 1
H&M Logistics Facility
2 Tesco 3
Logistics Centres
Logistics and Distribution Centre
Bank HQ Office building 4
Country
Tenant
Lot size
Poland
H&M
€60 m
Hungary
Tesco
€85 m
Croatia
Konzum
€80 m
Poland
Bank Pekao €110 m (Unicredit Group)
1
2
3
4
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www.victorios.co.uk | info@victorios.co.uk