West Register, the internal property unit for RBS, has placed a £63 million guide price on the portfolio of commercial property assets, which includes a collection of industrial distribution units.
Property Week predicts, the winning bidder will be picked within two weeks. If the deal goes well the bank is set to sell more property portfolios of assets.
Philip Marsden, Director of Jones Lang LaSalle which is RBS’ selling agent, said: “Demand has improved significantly for off-prime and secondary assets, which deliver more yield than most types of investment at the moment.”
The West Register property portfolio is worth around £200 million, with assets valued at more than £3 billion.
For the first time the bank is starting to sell assets in a bundle rather than as individual properties in a move to quench investor demand for scale. Investors are also looking for high yields; the RBS portfolio carries a yield of 9 to 10 per cent.
The assets up for sale were originally owned by various RBS borrowers.
RBS recently refuted a Guardian newspaper report that claimed the bank was planning to sell a residential portfolio via West Register of more than 1,300 UK properties worth around £200 million.
The ‘bad bank’ theory is part of RBS’s recent dilemma of whether to confine £50 billion of their balance sheet’s toxic assets to their investment arm. This arm would then focus on running down the debts.
This controversial proposal has met criticism from investors saying the split would starve RBS from the benefits of the assets if they improve in value.
The confirmation of the split is expected to be announced in RBS’ third quarter results this Friday.
[ Picture: Elliot Brown ]
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