The property investment boutique making outstanding investor returns from its Northampton base
How long has Barwood Capital been operating in Northampton?
Barwood has been in Northampton since 1996. We were established out of Barwood Developments Limited, which is now db symmetry, in 2009.
We started with four people and are now 15 strong, with more recruitment underway.
What are your roles?
Jo: As Managing Director, I’m responsible for overall corporate strategy and management, fundraising and investor relations.
Guy: As Chairman, I help Jo run the business, and also I am currently focusing on the implementation of the property strategy working with our full time property team. I founded, and until February 2014, was Chief Executive of Mayfair Capital, a property investment fund management business which in April 2015 had around £800m of assets under management.
What does Barwood Capital do?
Jo: We focus on sourcing and adding value to underperforming regional commercial property opportunities through enhanced planning, development and extensive asset management. We create first class environments for our occupiers and their staff, prime investments for our end buyers and outstanding returns to our investors. We currently manage three property funds and they are on track to deliver 15%-17% IRR per annum net of all costs to our investors.
We have a long track record in “shed” development, which range from the big distribution centres you see at the side of motorways to small “last mile” distribution warehouses on the outskirts of towns, that are mainly there due to the unstoppable rise of internet retailing. Such “sheds” are a hot topic and lure for our investors. We also invest in offices, retail, residential and “other” property which includes student accommodation and care homes.
The average lot size for us is £5m-£20m on purchase. But we are seeking larger opportunities up to £30m on purchase to co-invest with existing investors who have expressed keen interest to do this.
How has your latest fundraise gone?
Jo: Our 2017 Fund has so far raised £70 million from experienced and sophisticated private investors plus British Airways and Merseyside Pension Funds. The Fund’s final close is expected shortly.
How is Northampton important to you?
Guy: Our roots are here which is why when we needed more space than we had in Grange Park, we knew we wanted to stay in the town. We moved to our new offices in Waterside Way at The Lakes in December. Being in the heart of the country, we can be anywhere in just a few hours.
We own and manage property from Manchester to Crawley to Bristol and then more locally in Northampton, Milton Keynes and Cambridge.
On our doorstep, Northamptonshire Borough Council has just approved outline planning permission to build up to 400 nursing or student bedrooms on surplus land to the rear of Riverside House on Bedford Road. It’s a game-changer as the development will enhance the area and bring vital accommodation to the hospital.
We hope to invest further in the town.
What are your growth plans?
Jo: Since 2009 we have invested and managed more than £200 million in the UK’s regional property assets. We are looking to double that in the next three to five years.
Whilst our current portfolio is focused on logistics this also includes residential sites delivering 140 units and over £60m of gross development value. It is likely we will raise a residential focused fund in 2018 as we have a very strong pipeline of opportunities.
Has your business model changed?
Guy: We continuously adapt to the market and forecasts. But as well as managing our own developments, increasingly we are working with third party development managers: of 30 projects invested in to date we have worked with development managers (DM) on three quarters of them. We are currently working with nine DM’s including six commercial and three residential.
We are keen to build strong long-term relationships with creative and aspirational developers.
How do I invest?
Jo: We have a minimum fund entry investment level of £1 million for our current commercial property fund. This year we are likely to be raising money focused on residential development with a lower initial commitment.
If you are looking to invest, it’s best to get in touch with either Guy or me. We are all about developing long-lasting personal relationships with our investors.
What’s the future?
Jo: More recruitment, investing our 2017 Fund monies into key commercial and residential buildings, managing all our funds to deliver outstanding returns and growing our investor base – simple!