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Vincent Tchenguiz begins £3.5bn sale of ground rent business

Tue 30 Sep 2014

Vincent Tchenguiz has sold a £240 million stake in his ground rent business Project MacDonald, as part of a wider £3.5 billion asset sale.

According to Property Week, this chunk of his portfolio has been sold to investment group Long Harbour and the deal is expected to be completed inside a fortnight.

The prospect of these assets being sold was first raised in 2012, but the process was held up because of the Serious Fraud Office's investigation into Mr Tchenguiz's dealings with Icelandic financial institution Kaupthing.

He was ultimately cleared of all charges and the authority is now set to award him more than £6 million in damages and costs.

Long Harbour's ground rents portfolio will be worth more than £1 billion once the deal has been completed.

The organisation faced strong competition during the bidding process, with the likes of Rothesay Life Group, Pramerica and Aviva Investors also expressing interest in the assets.

This is reflective of a wider trend, with a number of pension funds, insurance firms and sovereign wealth funds looking towards other elements of the Project MacDonald portfolio that are set to come up for sale in the near future.

Overall, it consists of the freehold interest in 248,000 rented homes across the UK in 39,000 residential developments.

Forty per cent of these properties are located in south-east England and are collectively worth £1.4 billion, while a further 20 per cent are in London and come to £700 million in value.

Project MacDonald also has significant interests in other parts of the country, with £595 million worth of assets in the north of England, as well as £420 million worth in the Midlands.

A further £280 million worth of property is located in south-west England, while the value of its Welsh portfolio adds up to £105 million.

Eollyn Ives, Head of Winckworth Sherwood's Ground Rent Team, commented: "It is encouraging to see continuing strength in the ground rent market with an increase in competitors who have an interest in portfolios of substantial size."

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