$450 Million Financial Investment Offers Colliers Control of Property Financial Investment Management Company
Jay Hennick, Colliers chairman
and CEO Colliers International Group Inc. today revealed it has agreed to acquire a 75% stake in Harrison Street Real Estate Capital LLC, a realty investment company with $14.6 billion in possessions under management. The deal is expected to nearby the 3rd quarter of 2018.
Under the regards to the deal, Colliers will get 75% of Harrison Street from its creators for $450 million, with an additional $100 million payable in 2022, based on the company accomplishing specific performance targets.
Co-founder and CEO Christopher Merrill will continue to work as Harrison Street’s CEO and will remain the largest individual shareholder. Harrison Street’s senior management group will continue to operate the company’s everyday company.
Jay Hennick, chairman and CEO of Colliers International, called the deal the most substantial in the business’s history and said acquiring the worldwide realty financial investment management company would provide a major brand-new development platform while also helping to integrate its existing operations in Europe.
“In addition to its best-in-class returns, we were especially brought in to Harrison Street’s concentrate on attractive real estate asset class techniques; massive sections providing significant, demographically-driven development opportunities with protective cycle attributes,” included Colliers CFO John Friedrichsen in a declaration announcing the arrangement with Colliers.
Colliers anticipates the annual run rate of management charge profits to be in between $100 million to $115 million.
“As we started to explore the idea of partnering with an outdoors investor to place us for the future, it ended up being clear Colliers was a best option,” said Harrison Street CEO Merrill in a statement. “Colliers supplies long-lasting stability and increased positioning amongst our group and limited partners. The relationship strengthens our worldwide capability and uses distinct market knowledge and deep relationships with owners and occupiers of realty all over the world.”
Based in Chicago with an office in London, Harrison Street concentrates on trainee and senior housing, medical office and storage financial investments. Harrison Street launched its first real estate mutual fund in 2006 and has given that produced a series of commingled real estate funds. In addition, the company has a European Trainee Housing Opportunity Fund, targeting the acquisition and development of trainee housing properties throughout the UK and Europe.
The firm reports it has actually obtained or established more than 822 residential or commercial properties in its targeted sectors of student real estate, senior housing, medical workplace and self-storage. Its financial investment customers consist of sovereign wealth funds, public and corporate pension funds, endowments, insurer, foundations and private household workplaces.
The firm was founded at completion of 2005 by Merrill in partnership with Chris and Mike Galvin, members of the founding family of Motorola. A Motorola predecessor firm, the Galvin Manufacturing Business, began operations on Harrison Street in Chicago.
In connection with this transaction, Berkshire Capital acted as monetary advisor and DLA Piper functioned as legal advisor to Harrison Street and the management group. Three Ocean Partners acted as monetary advisor and Winston & & Strawn acted as legal consultant to particular of Harrison Street’s investors. Sidley Austin acted as legal consultant to Colliers.