Gatehouse seals $54.5M realised investment

London bank's first realised investment kick starts a winning 2012

Gatehouse Bank plc (Gatehouse), a Kuwaiti wholesale Shariah compliant investment bank in London, has successfully delivered its first real estate realised investment, in the sale of VA Oceanside Clinic, a state-of-the-art medical facility near San Diego, California, U.S.A for $54.5m. The transaction delivers excellent news on behalf of Gatehouse Bank investors, as they receive dedicated annualized returns on the investment during the 18 month holding period, and profits on exit, which equated to a return on equity of 21% over its acquisition cost of $44.8m.

The successful exit marks a tremendous milestone for Gatehouse Bank, having amassed more than GBP300million in real estate investments in a 2 year period.

Chairman of the Board of Directors at Gatehouse Bank, Mr Fahed Boodai commented, "Gatehouse Bank has begun a winning start to the new year in 2012, with a transaction that has delivered on its promises to GCC investors to create ongoing income returns, and a lucrative return on investment. The achievement highlights the outstanding performance of the Gatehouse Bank Real Estate team, to provide the full spectrum of real estate expertise in the US and UK, sourcing dedicated properties in a very competitive market, acquiring properties and arranging for exit at opportunistic returns for its investors.

Boodai added, “Despite reports of a very challenging economic climate across international markets, Gatehouse is confident that its corporate strategy for 2012, remains sustainable with targeted opportunities which would suit our investor demand for low-risk, long-leased properties, that afford measurable returns from solid asset classes. Alongside its proven track record of accomplishments, Gatehouse will stay on course to complete a healthy pipeline of transactions in the office, student accommodation, and logistics sectors, to compliment an impressive portfolio of investments. "

The VA Oceanside clinic is an 80,000 sq m facility which saw the property leased and operated by the U.S. Department of Veteran Affairs for a period of 20 years. As a scarce opportunity in a strong and growing asset class, the backing of the US Government underscored the credit quality and significantly limited operational risk, to create an attractive prospect for investors who sought a low risk product with strong returns. With a long lease to the US Government, the income stream from this hospital purchase was extremely robust and contributed to the overall capital value of the investment.

Gatehouse Bank completed this transaction in conjunction with sister company, GSH and US real estate advisory firm Archstreet Capital Advisors.