Former ‘Dragon’ James Caan is investing in Birmingham boutique shopping mall the Mailbox as it prepares for a flotation on a new stock exchange later this month.
Mr Caan told BusinessLive he felt that the city centre complex was a sound investment and its initial public offering (IPO) gave the people of Birmingham a unique chance to own a slice of the city’s thriving real estate market.
Mailbox REIT will be the first company to list on the new International Property Securities Exchange (IPSX) which was set up as a world first to trade shares in companies owning single, institutional-grade real estate assets.
Trading in its shares is due to commence on December 14.
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Speaking exclusively to BusinessLive, the entrepreneur said: “I’ll be investing in the Mailbox – it’s quite a good investment and return.
“The reason I am excited by this IPO is I feel consumers do not get the opportunities to access institutional type investments.
“If you have £50,000 to invest, typically you might spend £100,000 on a buy-to-let property and then have to manage it and collect the rent but if something goes wrong it can be a headache.
“With the Mailbox, rather than buying a £100,000 property, you are getting access to a £180 million property with proper tenants and leases which is well managed and well run.
“What this does is give the consumer the opportunity to play on a level playing field with institutional investors.
“The fact it is floating on a stock exchange means there has been proper due diligence and compliance and it has been independently valued.
“The Mailbox is an iconic location in Birmingham, it’s not disappearing, it will be there for investors.”
Mr Caan was a member of the famous panel on hit BBC show Dragons’ Den for four series although he has since sold his shares back to the founders of each of the businesses he invested in during his run.
The 59-year-old is not taking it easy though.
He is still invested in more than 20 businesses in the recruitment market – the same sector where he made his initial fortune as founder of Alexander Mann – and also M7 Real Estate which acquired the Mailbox last year.
The building, whose tenants include high-end fashion brands, restaurants, professional services businesses and the BBC, is currently undergoing somewhat of a change of direction.
In November, co-working office provider Spaces announced a management deal to run a 50,000 sq ft facility on the ground floor which will remove an entire level of retail from the centre.
Looking ahead, Mr Caan said IPOs of assets such as the Mailbox would offer a new alternative in the investment market with a second float of an office block in Leeds expected to take place early next year.
Mr Caan added: “In the past, when I’ve looked at property funds, I’ve shied away because I feel they are a bit faceless and I don’t know where my money is.
“I don’t know which buildings I own or where my investment is but here investors will have transparency on where their money is.
“And because the Mailbox is an individual asset, someone who lives in Birmingham can drive past their investment, see it and even shop in it.
“For Birmingham to be the first asset on the exchange is a great testament to the city and the quality of product that’s available there.”
Referring to the launch of the new stock exchange, Mr Caan said it was always a welcome move when something disrupted the traditional market.
He has so much faith in the concept that he has even invested his own cash into IPSX as well.
“The man on the street wants something they can see and touch and that they can get their head around.” he concluded.
“If this takes off, there’s a trillion pounds worth of real estate in the UK that could eventually end up on this exchange.”