The Warrington-based developer, working with JR Capital, is aiming to raise £100m to invest in multi-let industrial assets in the UK, including in the North West.
The five-year fund will target industrial investments across the country ranging from £5m to £15m, with the first close already raising £25m in equity from JR Capital’s Middle East-based private and institutional client base.
This will give the partners an immediate £50m to deploy into new schemes, including in the North West, where deals are anticipated shortly.
The partnership has already made its first acquisition, a 71,700 sq ft asset in Newcastle-upon-Tyne.
Chancerygate currently oversees around £220m of assets across the UK, totalling nearly 5m sq ft of commercial space over 355 units. Last week, it announced the £3.6m sale of a unit at Eaton Point in Chorley.
The developer’s asset manager said: David Tyson, said: “A key aspect of our growth strategy is to further increase the size of our asset management business. Our partnership with JR Capital and the funds raised will play a significant role in achieving that objective, so we are delighted to have achieved a first close in a challenging fund-raising environment.
“The fund will allow us to add to the mandates our asset management team already has from the likes of Bridges Fund Management, Carlisle City Council and Patrizia.”
JR Capital managing director, John Collier-Wright, added: “We believe the multi-let industrial sector is still undervalued. It offers relatively high yielding and well diversified income which is attractive in the current environment. The sector is one of very few which has real potential for growth over the short to medium term, underpinned by key macro fundamentals.
“There is a lack of supply of small to mid-sized industrial units across the UK, coupled with an ever-increasing demand from a better-quality tenant base. The shift to online commerce and the need for storage and last-mile logistics space will inevitably continue to drive demand and rents.
“Our clients continue to have a strong appetite for UK commercial property, and they see the defensive nature of this asset class as a hedge against the continued uncertainty surrounding Brexit.”