Higher-risk fund’s debut scores 25% return for Mayfair

Mayfair Capital Investment Management’s higher risk capital growth fund has made a 25% return in 12 months on its first project. Mayfair Capital’s £12m MC Property Growth Fund 2 and partner Beaubridge made a £5m preferred equity investment in Liberty Properties’ luxury residential development, 2 Hyde Park Square, W2. The developer decided to exercise its right to buy out Mayfair and Beaubridge early. James Thornton, an executive director at Mayfair Capital, said: “We hoped to be in a bit longer but there were provisions for going our different ways.”

The investment manager has also completed the conversion of its £38m MC Income Plus Fund from a limited partnership to an open-ended exempt property trust for UK pension funds, transferring the assets without tax leakage. Thornton said few of the fund’s investors had wanted to redeem and one new pension fund would invest £3m at  the entry date of the end of September. “They are in for the income,” he added. The fund’s target distribution yield is more than 5% per year and it is yielding 6.9% to new investors. Mayfair Capital also manages the Property Income Trust for Charities, which Thornton said had taken in £20m in the first half of the year and was on track to take in more in the second half. The manager is still in talks with Svenska Handelsbanken about refinancing a fourth vehicle, MC UK Property Fund, which is in breach of its covenants. The Handelsbanken loan matured earlier this year.