Toronto-listed real estate company Dream Global REIT has bought a Dutch real estate platform for €622m from joint venture partners TPG and Patron Capital Partners.
Merin, which manages a portfolio of 170 office and industrial assets in the Netherlands, will provide Dream Global REIT with an immediate presence in the Dutch property market.
Merin was formerly Uni-Invest a Dutch real estate company taken private by Lehman Brothers before the global financial crisis.
TPG and Patron acquired the company in 2012 through a complex restructuring of commercial mortgage-backed securitisation (CMBS) debt, before rebranding it Merin.
Since then, a new management team led by Bas van Holten has repositioned the portfolio through a combination of asset management, refurbishment and more than 50 acquisitions and disposals. It also recently entered into €440m of refinancing.
The purchase gives Dream Global REIT exposure to a new market. The company was set up to provide Canadian investors with foreign real estate exposure and has so far invested in Germany and Austria.
Chief executive Jane Gavan said Dream Global REIT is expanding its “European presence into the Netherlands at what we believe to be an opportune time in their real estate cycle”.
She said: “We are entering a market that has good office fundamentals and growth potential, and we will have a sizeable Dutch real estate management team that has a successful track record.”
Anand Tejani, partner at TPG Real Estate, said: “Having acquired Merin through an innovative and complex transaction in 2012, we are delighted with the successful transformation of the company in collaboration with management and our partners at Patron.
“This deal is a good example of TPG Real Estate’s thematic approach to investing and building best-in-class real estate platforms.”
Michael Muscolino, Partner at TPG Sixth Street Partners, an affiliate of TPG, said: “The Merin investment reflects TSSP’s approach to creating opportunities to unlock value in underlying assets through innovative structuring and execution at the point of investment.”
Keith Breslauer, managing director and senior partner at Patron Capital Partners, said: “This transaction is a further example of Patron’s expertise in acquiring a distressed investment, bolstering the management team, and growing the property-backed business.
“Over the last five years, we have worked successfully with our partner, TPG, and the new Merin management team to transform the business into one of the leading real estate investment companies in the Netherlands.”