Grosvenor has had development, investment and fund management operations in North America since the early 1950s. Throughout that period we have been actively involved in all forms of retail property, downtown offices, business parks and industrial parks. Of the US$1.5 billion portfolio under management, 25% is in Canada and 75% is in the USA. The strength of the real estate market throughout North America in 1999 enabled us to expand our development and investment programme during the year.

Much of our development programme is focused on office parks, especially in those areas where there has been strong demand from the high technology, research and development, computing and e-commerce industries.

Our San Francisco office has been an active developer and investor in Silicon Valley for 20 years and is currently working on a twelve building complex, scheduled for refurbishment and re-leasing over the next few years. We also have office or business park developments under way in Baltimore, Tampa, Florida and Washington DC.

The North American retail market remained robust, although rents began to stabilise following the rapid increases of the past couple of years. In October 1999, we sold the Sevenoaks Shopping Centre in Abbotsford, British Columbia. Grosvenor developed Sevenoaks in 1975 and expanded it over the years. The final phase was developed in 1999. The sale has enabled us to be more ambitious in our development programme, starting with the acquisition of 21 acres in South Surrey, south of Vancouver for a 21,000m2 (226,000 sq ft) shopping centre.

Annacis Island, Vancouver, was Grosvenor's first investment in Canada in the1950s. Since then, it has been developed into a 485 hectare (1,200 acre) business park of which we still own about a third. Part of that holding is now suitable for redevelopment and in 1999, 16 hectares (40 acres), previously leased to a user, were subdivided into seven separate parcels for redevelopment. Construction began during the year on a new distribution building of 13,935m2 (150,000 sq ft).

Grosvenor's early Fund Management partnerships were established to invest in North America with UK pension funds and institutional investors. Some of these relationships have continued over a quarter of a century. One of our longest and largest partnerships is with the BBC pension fund. More recently, we have established relationships with American Freeholds, a group of UK insurance companies and the Getty Family Trusts.

In 1999, our satellite offices in Calgary and Tampa continued to prove useful. In Calgary, we completed a renovation of the Bow Parkade, a 1,000 space car park in downtown Calgary and we are currently evaluating development projects in both Calgary and Edmonton.

In Tampa, we plan to expand both the WestShore Plaza Shopping Centre and a 21,370m2 (230,000 sq ft) office property, which we acquired at year end.

In 1999, Grosvenor also obtained its first indirect foothold in South America when Sonae Imobiliaria bought 50% of a Brazilian shopping centre owner, developer and manager to form a joint venture, Sonae Entlanta. The Company has a shopping centre, Dom Pedro Shopping, at the conception stage. It will be located on the Campinas ring road and phase 1 is planned to have 90,000 m2 (970,000 sq ft) of retail space, due for completion by the end of 2000.


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