03/04/2008

Select property fund secures record lease in Poland

Standard Life Investments, one of the largest property investors in Europe, today announced that Panattoni Park, Stryków in Poland, a key development for its Select Property Fund, has secured the biggest ever lease within the Polish warehouse market.

The record deal consists of a 56,000sqm lease to Leroy Merlin, a DIY retailer operating in the Polish market since 1994. To be developed during 2008 in a joint venture with Panattoni Development Company and on behalf of SLI's Select Property Fund, Panattoni Park is a 100,000sqm distribution warehouse facility located in Stryków, north of Lódz, central Poland.

Since its launch in October 2005, the Select Property Fund has made a number of direct property acquisitions including purchases in the Czech Republic, Germany, Poland, Portugal and Australia. The Fund's performance since launch has been strong, with the retail accumulation unit price rising 16.74%.¹ Assets under management now stand at £1.26 bn.²

James Rushworth, Director of European Investments at SLI's Paris Office, said:

'We are delighted to have secured this letting, which adds to the success of our development programme for the Select Property Fund. The Fund has a development programme in excess of 700,000sqm of logistics and retail accommodation in Europe - equivalent to almost seven Wembley stadiums - and with an end value of over €550m.

'The strategy has been to focus the Fund's direct investments in Europe on opportunities where value-add opportunities exist in economies with strong fundamentals. The GDP growth in Poland last year was 6.5% and it is expected that consumer spending will increase by more than 5% in 2008. Such growth contributes to strong demand for both retail accommodation and distribution networks.

'Also in the form of a joint venture with Panattoni, the first scheme completed was another development in Lodz adjacent to the new Dell manufacturing facility. This project recently won 'Central & Eastern European Industrial & Logistics Development of the Year 2007' at the CEE Real Estate Quality Awards. The scheme was fully let during construction and proved such a success that we are developing an adjoining plot, which has again let before completion.'

Robert Dobrzycki, Manager of Panattoni Poland, said:

'This is the second time our team in Poland have achieved a letting in excess of 50,000sqm and we are delighted to be constructing another key distribution facility for an international retailer in Poland.''

The first of its kind in the marketplace, the Select Property Fund offers both institutional and retail investors access to UK and international property markets in North America, Europe and across Asia Pacific. The fund accesses commercial property markets via direct investment, unquoted specialist property products and stock exchange listed property vehicles globally.

1. Source: SLI, 13/10/05 to 31/03/08, total return, net of charges.
2. Source: Standard Life Investments, as at 28/03/08.