Ares, Regis gather $1B to join ground lease race

Newly formed Haven Capital to seek out property owners who need cash

Ares Management CEO Michael Arougheti (Getty)
Ares Management CEO Michael Arougheti (Getty)

Safehold now has competition.

Global alternative investment manager Ares Management and Regis Group, a London-based global investor and operator, have formed Haven Capital to get in the field of ground-lease investments, Bisnow reported.

Until recently, the niche but growing field was led by iStar-managed real estate investment trust Safehold.

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Regis is one of the largest holders of ground leases in the U.K. The effort with Ares aims to eventually bring Haven Capital to an initial public offering, Commercial Observer reported.

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“We believe ground leases represent an attractive, long-term funding source,” said Nick Gould, chairman and founder of Regis, in a statement.

SL Green Realty’s Joe Shanley joined the firm to lead its expansion.

Armed with an initial $1 billion, Haven plans to buy land under “high quality assets” in the country’s 50 top markets from property owners and collect monthly rent. The investors figure that some property owners, who would retain ownership of the buildings above, need cash in this economic downturn.

David Roth, a partner and the head of U.S. real estate equity within Ares’ real estate group, said in a statement that the firm believes “ground leases provide a compelling solution for both long-term property owners and developers, and we look forward to building this platform alongside Regis.”

[Bisnow, CO] — Akiko Matsuda