M&S City site is Fergie fund's first goal

A NEW property fund backed by Manchester United boss Sir Alex Ferguson and other footballing figures is close to signing on the dotted line for Marks & Spencer's flagship City development in a deal worth up to £160m.

Active Asset Investment Management (aAIM), the Ferguson-backed property investment company, is understood to be in a final round of talks to buy the freehold for 70 Gracechurch Street in EC3 - its first purchase - which has M&S as an anchor tenant.

Property magazine Estates Gazette says the seller of the 200,000 square foot development is XL Capital, an insurance company which bought the site from M&S only a month ago.

The deal would result in aAIM becoming the new landlord for M&S's 60,000 square foot patch and granting XL Capital a 25-year lease to occupy another part of the site at around £50 per square foot.

Feguson would take a stake in the building through a syndicate of investors arranged through aAIM. The fund is backed by 20 individuals, including young international footballers Leeds United's Alan Smith and Gareth Barry of Aston Villa, who have put up £50m on the way to getting together a £750m fund to be invested in 'high quality' office blocks, industrial property and retail units.

The fund is being run by City wheeler-dealers Mark Tagliaferri and Robert Whitton.