Barings has bought a £70.7m (€82.2m) London office building on behalf of its second European value-add real estate fund from DWS.

Barings said it has bought 25 Moorgate on behalf of Barings Real Estate European Value-Add Fund II (BREEVA II), a fund which raised €850m at its close last month.

The 25 Moorgate asset comprises 75,000sqft of office space, with 7,800sqft of retail and food & beverage space across the ground floor and basement. 

Barings intends to refurbish the entire building in line with BREEVA II’s value-add strategy.

Darren Hutchinson, managing director and head of UK real estate transactions at Barings, said this was an attractive opportunity to acquire a well-located office asset that offers both income in the short term alongside significant reversionary potential following a comprehensive refurbishment programme.

“Offices in central London still have immense appeal to occupiers that are keen to attract and retain talent by providing best-in-class space that can facilitate hybrid working not just through the quality of its facilities, but also its proximity to both transport connections and a range of local amenities that will encourage staff to return to the office.

“Following its refurbishment, 25 Moorgate will be well-positioned to take advantage of the structural trends underpinning office take-up and will deliver significantly more value for our initial investment,” Hutchinson said.

Gunther Deutsch, the head of Europe real estate transactions at Barings, said following the recent acquisition of a soon to-be-developed office asset on the Southbank in London and an office refurbishment in Milan, “we are keenly looking for other office opportunities across our jurisdictions, including Sweden, the Netherlands, Germany, Italy, France and Spain”.

Deutsch said: “Aside from well-located existing assets, we are eager to explore joint ventures with developers to build state-of-the-art ESG/net-zero office space across Europe as we are strong believers in the attractiveness of these qualities.

“As such, 25 Moorgate is a perfect addition to the UK portfolio that we have acquired so far and we look forward to announcing further transactions in our preferred sectors of logistics, alternatives – living, and office in the near term.”

Markus Wickentraeger, the head of real estate portfolio management, Germany at DWS said: “This sale is the conclusion of a strategic investment in the London office market in 2009, and we’re very proud of the outcome.”

Wickentraeger said DWS will continue to seek London office opportunities in emerging locations and with value growth potential for its varying investment strategies.

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