HENDERSON Global Investors, the fund giant behind Westfield Stratford City shopping centre, has joined forces with the US Teachers’ asset manager TIAA-CREF to create a £13bn investment management firm.
The new company, called TIAA Henderson Global Real Estate, will combine Henderson’s £11bn European and Asia Pacific property business with TIAA-CREF’s European assets, the pair said yesterday.
Henderson will own 40 per cent of the venture while the rest will be owned by TIAA-CREF, with the US firm’s real estate head Tom Garbutt set to take on the role of chairman.
Henderson has also sold its £1.7bn US property portfolio to TIAA-CREF as part of the agreement.
Together the North American business and the joint venture will have around ($63bn) £41.5bn assets under management, making it the world’s fifth largest property fund manager.
The deal is the latest in a string of property fund management mergers to have taken place over the last year.
It comes a just month after fund titan BlackRock snapped up MGPA to build its presence in Asia and Europe, while investment firm Ares Management was also reported last month to be buying AREA Property Partners.
Meanwhile CBRE bought ING’s European and Asian property businesses for $1.1bn (£681m) in 2011.
Garbutt yesterday told City A.M. the two companies had known each other “for a very long time” and they both had elements in common that drew them together.
“The geographic footprint is complementary – with Henderson big in Europe and Asia and TIAA-CREF in US – this enhances the proposition for our clients many fold,” he said.
Henderson chief executive Andrew Formica said: “Henderson has long recognised that its property business would benefit from greater scale and access to capital to accelerate its future growth.”
James Darkins, head of property at Henderson, will become chief executive of the new London-based company.