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LONDON-Business Park owner, developer and service provider Arlington Securities has restructured its £800-million UK asset base in order to become less of traditional developer and more of a 21st century asset manager. It has also pulled in a reported extra £50 million investment from its main shareholder Legal & General.

Arlington was owned jointly by Legal & General, affiliates of PRICOA Property Private Equity Limited and Akaria Investments. They have now split the company into three, dealing with three UK, European and International developments.

This restructuring will also enable Arlington to realise its long-term strategy to create a specialist real estate management and service business, generating revenue from its development and management activities, from the delivery of its support services to customers on and off its business park developments and from fund management services.

Legal & General has spent the money increasing its exposure to the Arlington’s UK Limited Partnership, Arlington Business Parks Partnership. It has 63.4% of ABPP with PPPE and Akaria holding 15.2% each and the remaining 6.2% being held by Arlington. ABPP has gross assets of £800 million.

Arlington will be the general partner of ABPP as well as undertaking all development, development management, asset management, business services and online service activities. Legal and General Investment Management, an FSA regulated company, will be appointed investment adviser to the ABPP and act as the fund operator.

‘It is the objective of the Partnership to become the pre-eminent Business Park Investment and Development vehicle in the UK and one of the top three property investment Partnerships in the UK,’ says chief executive Patrick Deigman.

Arlington has also created a European business parks vehicle to which PPPE and Akaria have subscribed new capital to fund its future development. The Partners in the European vehicle will be PPPE and Akaria with 47.5% each and Arlington with 5%. Initially, this will consist of the 4 million-sf Paris International Business Park with new Parks projected in Barcelona, Madrid and Brussels. The long-term strategy is to create a European business parks investment program similar in size to the UK Partnership fund.

The international assets, which at present consist of an interest in the Shanghai Business Park, will be transferred into a new International vehicle with PPPE and Akaria each owning 45% and Arlington holding 10%.

With this re-organisation in place and following the creation of these three new focused, specialist investment vehicles, Arlington has become a revenue based management and service Company which will be owned by PPPE 25%, Legal & General 25%, Akaria 25% and by an Arlington senior management team 25%.

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