By Patrick Jenkins

An investment manager part-owned by the Saudi royal family is planning to invest a chunk of its assets in UK and US commercial property, according to Prince Faisal bin Salman bin Abdulaziz, its chairman.

For Jadwa Investment, commercial real estate was, with natural resources, the most appealing investment opportunity, Prince Faisal told the Financial Times in an interview. The fund is targeting a £700m ($1.1bn) commercial property transaction in the UK in collaboration with European property investor CIT.

Property specialists said only one transaction of that scale was under way: a portfolio being sold by insurance group Aviva, for which CIT is bidding.

Fadi Tabbara, the fund’s chief investment officer, said that it wanted to expand abroad to continue diversifying revenue streams so as to make them “less sporadic and more predictable”. Brad Bourland, Jadwa’s chief economist, said: “We are focusing on areas where there is currently a favourable exchange rate, attractive asset prices and a historical connection. The US and UK markets meet these criteria the most at the moment.”

The prince said Jadwa, which had $2bn under management, had about half that sum invested in discretionary funds for clients while the rest was split between 17 third-party funds. A further two funds - focused on commodities and private equity - were planned. Jadwa is one of the best performing asset managers in the Saudi market. Its Saudi equity fund is up 26.5 percent in the year to date versus an increase of 16.5 percent in the benchmark S&P Saudi Shariah index.

Prince Faisal said he saw no opportunities to invest in bank shareholdings, as other Middle Eastern funds have done.