Eurazeo’s real assets arm has joined forces with Arax Properties to buy a €105m London office building from Stenprop.

Eurazeo Patrimoine and Arax have bought the 119,000sqft Euston House in the London Borough of Camden from the UK REIT.

Eurazeo said it’s equity investment commitment after financing is around €40m, adding that the property will be refurbished to enhance the asset’s value.

Renaud Haberkorn, Eurazeo Patrimoine’s managing partner, said: “Contrary to the continental European markets, where values have soared over the past three years, the London office market experienced a slight correction recently, despite rental demand remaining strong.”

Haberkorn adds that the Euston House investment has “tremendous value creation potential”.

“Building on this initial London investment, Eurazeo Patrimoine will be well placed to seize any further opportunities that arise.”

Stenprop previously announced its plan to become a specialised UK multi-let industrial (MLI) business and, over the next few years, to sell substantially all of its non-MLI assets and utilise the sale proceeds to build a focused UK MLI business.

Paul Arenson, the CEO of Stenprop, said: “The sale of Euston House is the last of our Central London offices to be sold and completes a sales programme of more than £216.6m (€240m) of Central London offices.

“The net proceeds will be used partly to reduce debt and partly to acquire additional multi-let industrial assets in line with our transition strategy into a 100% UK MLI business.”