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Aberdeen picks up Goodman

Aberdeen Asset Management has acquired UK-based Goodman Property Investors from the Goodman Group for approximately €114 million.

Real estate special focus

GPI, which has a substantial UK footprint, will become part of Aberdeen Property Investors, Aberdeen’s specialist property investment division.

 “It’s easier to buy rather than build,” says Rickard Backlund, chief executive of Aberdeen Property Investors. “It takes time, particularly in a difficult market like the UK it isn’t easy to build organically.”

The deal, announced in May, has been positively received by market participants, who view it as a sign that the UK market in particular might be starting to move out of the sub-prime-induced quiescence. Backlund says the deal started out as a contact with GPI late last year when the parties were in discussions to create a joint venture.

“It’s good timing,” says Backlund. “We have six to 12 months to consolidate the businesses and will be well organized when the markets come back.”

GPI has assets under management greater than €8.9 billion, 93% of which is invested directly and indirectly in the UK.  Before the acquisition, only a small proportion of Aberdeen Property Investors’ assets under management were in the UK. Now Aberdeen has gained instant critical mass in a market it considers crucial to its growth.

“If you look at Aberdeen Property Investors we are very strong in the Nordic region and continental Europe, but not in the UK,” says Backlund. “We want to be able to get the best deals, new clients and be in a strong position to manage properties and that means we need to have a local presence.”

With the GPI acquisition, Aberdeen Property Investors’ assets under management will increase by more than 42% to approximately €30 billion, making it the second-largest property investment manager in the UK and a top 10 global player. The acquisition follows on from Aberdeen’s acquisition earlier this year of Degi, a provider of open-ended property funds in the German market. Backlund says no further acquisitions are in the offing, at least in the near term.

“Degi and Goodman are big pieces of business to digest,” he says. “It will take at least six months.”

What is on the agenda is bringing together pieces of the Degi, GPI and Aberdeen businesses focused on Asia to create a platform in the region. “Aberdeen Asset Management is very strong in Asia and that will support us building a property business there,” says Backlund.

In addition to its designs on the Asian market, Aberdeen is also gearing up in Russia. The firm recently installed a team in St Petersburg that is just about to make its first closing on its Russia fund, which targets commercial property opportunities.

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