Intelligent Asset Management

Intelligent Asset Management

Cordatus Intelligent Asset Management In an ever changing, increasingly competitive property market, selection of the right asset manager is the key to outstanding performance. Cordatus is independent and wholly owned by five Directors who have over 130 years of combined experience. The quality and experience of the Cordatus team is the critical factor that enables us to maximise returns for our commercial property partners. Through active asset management and risk-controlled development, we have a proven track record of outperforming the targets set for our clients. We offer strong skills and experience combined with integrity and diplomacy to consistently achieve results for our clients. Tom Laidlaw, Chief Executive It has been my privilege to chair the Cordatus board since its inception. Our approach has evolved through lengthy experience with leading fund management companies. Our management team has consistently outperformed targets, driven up growth and excelled through agile and responsive entrepreneurialism. I am filled with optimism by our progress and by the bright future that awaits us. Peter Arthur, Chairman 2

Cordatus Intelligent Asset Management Why choose Cordatus? Left: Peter Arthur, Chairman Right: Tom Laidlaw, Chief Executive We re specialists Real estate asset and investment management is what we do and we have an extensive track record of doing it well. We re focused It s our job to maximise returns on investment and minimise risk. That s the only measure of success. We re agile With offices in Scotland, London and the Midlands, we re ideally placed to manage opportunities anywhere in the UK. We re detailed We pride ourselves on our attention to detail in all aspects of our work from the big picture to the smallest point. Through forensic attention to detail and deep knowledge of its markets, Cordatus has a proven record of adding value to clients assets. Detailed financial analysis is at the heart of everything we do. Cordatus tell it how it is. We don t invent value simply to win instructions. 3

Cordatus Intelligent Asset Management Our success has robust roots Image: Below Basingstoke Our five Directors have, between them, over 130 years of experience. Before establishing Cordatus, all Directors held senior positions in some of the UK s most successful investment and development companies. Our extensive experience as clients ourselves has given us an understanding of client aspirations and concerns, and that has been a key factor in many of the appointments we have won. A real understanding of real estate Our expertise covers a wide range of corporate structures across the UK, Europe and the US. Significantly, every one of our Directors has personal experience of trading and managing assets in all of the main UK business centres and many of the smaller ones. We have detailed knowledge of these markets and excellent relationships with key local people. Our backgrounds and abilities puts Cordatus in a strong position to create and manage real estate assets and funds. Taking responsibility seriously We take the time to understand every client s portfolio objectives and pursue the strategy that s right for them. Our Directors also regularly undertake peer reviews of proposed purchases, business plans and initiatives, ensuring that our clients benefit from collective experience. Each client has two Directors who take active, hands-on responsibility for work carried out on their behalf. Crucially, we will never take on any new mandates where there might be a conflict of interest with an existing client. Best practice and complete transparency are basic essentials. We respect our clients privacy, and value our relationship with each of them. We are a values based organisation: integrity; governance and transparency are the building blocks of our business. We treat everybody in the way we would wish to be treated. We also like to think that we are good to deal with. 4

Cordatus facts Pronunciation: kor da.tus Meaning: wise, prudent Cordatus was established in February 2007 as an independent real estate asset management specialist. It is wholly owned by the Directors, who bring more than 130 years of combined experience and who lead every single project. There are currently 10 professional staff within the company. Our Finance Director has worked in real estate for over 14 years and understands its challenges. She works closely with the other Directors and asset managers to ensure every client has a service that matches their needs. We work with institutional funds, private funds, high net worth families, Special Servicers, banks and administrators to help them maximise the value of existing assets and acquire new ones with high potential. Our activities and knowledge span the UK and our strategic approach involves active asset management, risk-controlled development and meticulous business planning. We currently have over 350 million of assets under management and over the past five years we have successfully completed sales to the value of 250 million. 5

Cordatus Intelligent Asset Management Successful Investment Image: Below Orchard Shopping Centre, Taunton Successful investment is based on detailed analysis. Four aspects stand out. Know your market National trends and local conditions can interact in quite unexpected ways. Understanding these dynamics is essential. Research is fundamental It is only by assessing demand and supply and the history of a building that we can build a detailed business plan. Knowledge of the condition of the buildings and the intentions of occupiers are vital in planning a project timeframe that maximises performance. Financial appraisal requires intelligent, realistic projections All component costs must stand up to scrutiny and peer review. Monitoring is essential and we constantly revisit business plans to minimise risk and unlock an asset s potential. Due diligence should be thorough and cohesive We ensure that every aspect of each project is rigorously assessed and that all the elements are drawn together to present a clear overview. We demand precision. Cordatus s experience working as investor, developer and asset manager enables the company to appraise assets from all angles. We employ highly experienced asset managers with unrivalled UK wide experience, gained at some of the UK s top investing institutions and developers. 6

Successful Asset Management Successful asset management is a hands-on business and we like to get our hands dirty. Maximising income is the key driver Rent reviews, lease expiries, tenant breaks and occupancy levels are just some of the components that have to be continually driven and relentlessly pursued. Property management must never be neglected It can have a significant bearing on income and capital value. It is important to us to ensure that the management services and accounts provided by our partners are executed diligently and are up to date. Knowing your tenants is essential We endeavour to understand their business needs and objectives. Adding value requires an entrepreneurial ethos Our varied and extensive skills enable us to assess assets from various perspectives and identify opportunities by thinking outside the box. Risk management requires continual review of the dynamics of risk versus reward From initial appraisal and due diligence during purchase to business plan formation and eventual sale, we review all possible outcomes. From our broad capabilities, we can tailor the individual service you need to achieve the results you want. Since 2007, we have managed more than 420 rent reviews, lease renewals and letting negotiations. The aggregate rents involved, amounted to over 27.5 million and our results averaged 4.6% above business plan expectations. We have appraised and advised on developments with a 2014 value of over 2 billion. We have very wide market coverage that ensures we gain access to appropriate investment opportunities, including those not actively on the market. Recently, after implementing strategies to add value and, critically, getting the timing right, we separately sold 13 properties from a short-term portfolio of secondary assets for an aggregate sum that was 41% ahead of business plan targets. 7

Cordatus Intelligent Asset Management Retail Images: Left Shopping centres in Gravesend, Leighton Buzzard and Waterlooville Right Retail warehousing in Longwell Green, Bristol Retail portfolio In 2011, we were appointed to manage a portfolio of shopping centres in Gravesend, Leighton Buzzard and Waterlooville with the objective of adding short-term value. The Thamesgate Shopping Centre, Gravesend, is a freehold, 80,360 sqft development incorporating 20 retail units, mall retailing, an office block and a multi storey car park. Waterbourne Walk in Leighton Buzzard is the town s main retail area, an 84,454 sqft open shopping centre with 21 retail units anchored by a Waitrose supermarket, plus three external units. Wellington Way, Waterlooville, is an open, pedestrianised 56,285 sqft arcade of 25 retail units anchored by an Iceland supermarket. It is the town s second largest shopping centre. Through active, innovative management, we have completed 30 lease renewals, re-gears, lettings and rent reviews and taken positive control of car park income and mall commercialisation opportunities. In doing so, we have increased rental income by 15% and, amidst a challenging retail environment, we secured the sale of the properties at a price far in excess of the business plan. Retail warehousing Longwell Green, Bristol is a 20,000 sqft retail warehouse. At the time of our appointment, 50% of the space was vacant and the rest on short-term lease to a national retailer. As part of our business plan, we managed the professional team who were successful in obtaining detailed planning consent for a full refurbishment of the property. In parallel, we worked with specialist agents to prepare and execute a targeted marketing strategy that achieved the necessary agreements to lease the units. Finally, we marketed the investment and completed its sale at well above our target exit price. 8

Industrial & Office space Images: Left Forty Cumberland Avenue, London Right Purchased Grade A office space near Heathrow Industrial Forty Cumberland Avenue in London NW10 is a modern freehold unit of 58,375 sqft located in London s premiere industrial park. It was let to Bakkavor Foods. Having asset managed the property since 2007, we negotiated a 14% rent increase and concurrently re-geared the lease, extending it by 10 years. The investment was then offered on the market at a price of 10.325 million, reflecting a yield of 6.25%. Following a targeted marketing campaign, a price of 11 million and a yield of under 6% was achieved. The final sale price was 45% higher than the valuation prior to the re-gearing of the lease. Office space At a time when Grade A office space was in short supply and demand was rising, we formed a joint venture with an Opportunity Fund to buy a property that could be refurbished to Grade A standards. It was important that we could achieve the transformation during the window we had identified in the market. After a detailed research exercise we found an opportunity to buy a 94,000 sqft building near Heathrow. The building had short-term income, and it was in a prime location but had a dated specification. Our due diligence included a thorough investigation of all the competition to assess the letting risk, as well as comprehensive analysis of the refurbishment costs. We secured the purchase of the building and set about implementing our business plan. We obtained detailed consent to refurbish and extend the building, then negotiated a pre-let of the whole building while the refurbishment work was going on. The letting is one of the largest to be completed in the Thames Valley in 2014, and the investment is projecting a return well ahead of the business plan target and significantly ahead of programme. 9

Cordatus Intelligent Asset Management Our people are our most valued assets Above: From left to right Michael Cunningham, Peter Arthur, Paul Blyth, Sharon Gibson, Mike Channing, Gavin Munn, Tom Laidlaw. 10

Our Directors We continually seek to improve value and deliver to our clients. We have a high level of expertise in this area as we work with a varied level of clients. There is a single point of contact and we continually monitor accounting regulations, compliance and statutory requirements. Peter Arthur, Chairman Peter has been Chairman of Cordatus since its inception. He is a professional Non- Executive Director and is currently Chairman of Aberdeen Asian Income Fund Ltd, having been a Director of, and an investor in, a number of high-growth smaller businesses. He was an Executive Director of ISIS Asset Management plc for five years and subsequently became Managing Director. Prior to this he served for 14 years with Edinburgh Fund Managers and was then appointed Chief Legal Counsel, Europe for Franklin Templeton Global Investors Ltd. Peter is a solicitor and Chartered Company Secretary. Tom Laidlaw, Director Tom is a co-founding Director of Cordatus. He was formerly Head of Property at Scottish Widows Investment Partnership (SWIP) and has over 35 years in real estate investment management in the UK, Europe and North America. Tom is responsible for new business development, fund strategy and is the lead manager for the PwC/HSBC workout assets. Tom is a Chartered Surveyor. Sharon Gibson, Finance Director Sharon started her career in property accounting at Standard Life Investments in 2000. She joined SWIP in 2003 and held the position of Senior Property Accountant, responsible for all financial aspects of a 400m UK listed property investment company. Sharon has been with Cordatus since our launch and is responsible for all aspects of financial reporting and corporate governance. Sharon is a Chartered Accountant. 11

Cordatus Intelligent Asset Management Our Directors (continued) Mike Channing, Director Michael Cunningham, Director Gavin Munn, Director Paul Blyth, Director A co-founding Director of Cordatus, Mike has over 20 years experience in real estate investment management in the UK and Europe. He was formerly Deputy Head of Property at SWIP where he ran a 3 billion award winning UK property fund. Mike is responsible for fund strategy and is lead manager for the assets we manage on behalf of GE Real Estate. Mike is a Chartered Surveyor and holds a number of other industry qualifications. Michael is a co-founding Director of Cordatus. He brings 18 years experience in UK real estate investment management and was previously an Investment Director at SWIP where he ran a 400m UK listed investment company. Prior to joining SWIP he worked for Henderson Global Investors. He is responsible for fund strategy and works across all client mandates. Michael is a Chartered Surveyor and holds a number of other industry qualifications. Gavin co-founded Kirkstone in 2006 and grew it into a successful asset and development management company prior to its merger with Cordatus. He has over 20 years of experience predominantly as an investment and development principal. Prior to setting up Kirkstone he was a Director within the Stannifer Group and was responsible for several large scale developments. He also established the company s asset management business. Gavin is a Chartered Surveyor and also holds other industry memberships. Over the last 20 years Paul has amassed extensive experience in investment and development across all sectors. A co-founder of Kirkstone, he was previously a Director within the Stannifer Group with responsibility for a large retail fund as well as an extensive and varied development portfolio. Paul runs Cordatus s Midlands office and is responsible for new partnering opportunities. Paul is a Chartered Surveyor and holds a number of other industry qualifications. 12

Our Asset Managers Peter Benson, Asset Manager Pete, who is based in the Stratford upon Avon office, worked with Kirkstone and is responsible for the day to day management of a number of our assets. A chartered surveyor with 10 years experience, he has cross sector experience in both development and asset management, both as an agent and as a principal. He has been involved in a range of commercial and residential developments as developer and also as part of a management team advising developers on projects like the Bullring in Birmingham. Pete is a Chartered Surveyor. Andrew Murray, Asset Manager Andrew joined Cordatus in April 2011 and his main responsibilities include asset managing properties across all client mandates. He started his career at Chesterton and later moved to JLL to work in their UK Capital Markets Division advising institutional clients on all aspects of property investment. He has 11 years industry experience and before joining Cordatus, he was a Senior Surveyor at GL Hearn. Andrew is a Chartered Surveyor. Neil Tweedie, Asset Manager Neil joined Cordatus in June 2010, having already worked in the industry for 12 years. As well as asset managing a very active portfolio, he supports the Directors on many other initiatives. His previous experience includes working as a Senior Surveyor in JLL s business space team, advising investor and developer clients. He has also worked for Miller Developments on its UK development programme. Neil is a Chartered Surveyor and holds other industry qualifications. Douglas Gardiner, Asset Manager Douglas joined Cordatus in April 2013 and has taken responsibility for a varied portfolio of properties across the UK as well as helping with new partnering opportunities. He has over 17 years experience in providing proactive asset management and agency services throughout the UK, including a period in London where he worked for Land Securities Trillium before returning to Scotland as a Director of BNP Paribas Real Estate and subsequently of Mapeley Estates. Douglas is a Chartered Surveyor. In an increasingly competitive market our focus on the quality and experience of our team is critical to ensure our ability to maximise returns for our commercial property partners. In this regard we believe our team is second to none through enterprising active management and risk controlled development. Our Directors have a proven track record in a market that is increasingly dependent upon these skills to add value. 13

Cordatus Intelligent Asset Management Bold ambition, steady growth Changing times need adaptability and organised thinking. In a competitive and ever-changing real estate landscape, we believe creativity has become a key part of our winning strategy. Our ingenuity, born out of experience, gives us the ability to see opportunities where others see problems. The talent and ambition that drives us is balanced by an understated confidence. We have the self-assurance to hold our nerve as markets rise and fall, and the skill and experience to meet our business objectives no matter what obstacles present themselves. We have used our core strengths of robust analysis, careful asset management and alert adaptability to grow Cordatus during a particularly challenging period for the real estate market. As the property market continues to improve, we have a solid platform on which to grow the business further through strategic partnerships with new and existing partners. We are passionate about property and the future of our business, and relish the prospect of forging new partnerships. 14

Our clients and partners (past and present) Cordatus is an award winning company, with a sophisticated business mentality derived from extensive experience. Our small, niche company encourages entrepreneurialism and makes us more agile and responsive in pursuing opportunities to deliver value.

Cordatus Real Estate Edinburgh 26 Alva Street, Edinburgh, EH2 4PY T +44 (0)131 240 1470 F +44 (0)131 226 2946 E: info@cordatus-re.com Cordatus Real Estate Midlands 5 Mansell Street, Stratford Upon Avon, CV37 6NR T: +44 (0)1789 262 840 E: info@cordatus-re.com Cordatus Real Estate London 17 Savile Row, London, W1S 3PN T: +44 (0)207 758 0411 E: info@cordatus-re.com www.cordatus-re.com