£500M from Morgan Stanley JV Kandahar

Kandahar Real Estate Ltd, a subsidiary of a London-based private property investment and asset management firm, The Kandahar Group, has joined with Morgan Stanley Real Estate's MSREF V International in a 50:50 joint venture project with the intention of investing £500 million (US$944 million) into retail and leisure properties throughout the United Kingdom.

The venture's initial portfolio will include the 560,000-square-foot Drake Circus shopping center in Plymouth, U.K., which was developed for Morgan Stanley by P&O Estates Ltd., and opened on Oct. 5, 2006. Also in the initial portfolio will be Kandahar's 1 million-square-foot UK High Street property portfolio, with a total value of £243 million (US$458.7 million).

In a statement, Morgan Stanley executive director Toby Phelps said that the firm looked forward to taking advantage of the knowledge of U.K. retail investment brought by Kandahar, which holds a portfolio of 13 U.K. retail assets, dating back to the firm's original investment in 2003.

Owned by David Ross' Kandahar Trust, The Kandahar Group is led by the management team of Martin McGann, formerly finance director at Pillar Property Plc; Amanda Hill, former head of property at The Carphone Warehouse, where she led the growth of the store portfolio from 20 to 600 stores; and Mike Tyler, who was responsible for asset management within the Hercules portfolio.