Abu Dhabi SWF snaps up major office complex in Ghent

The Abu Dhabi Investment Authority (ADIA) has acquired the Zuiderpoort office property in Ghent, Belgium, signalling a new direction in sovereign wealth funds' capacity to penetrate Europe's secondary investment locations.

Asset: Zuiderpoort complex
Location: Ghent
Buyer: Abu Dhabi Investment Authority
Vendor: Icelandic bank SJ1
Price: €110 mln (estimate)
Yield: 10% (estimate)

PropertyEU reported at Expo Real that an unnamed Middle Eastern sovereign wealth fund was in advanced discussions to acquire the Zuiderpoort complex in Ghent. According to sources, the deal amounts to around EUR 110 mln, representing the largest multi-let asset trade in Belgium since 2008. It is understood to reflect a yield of 10%.

The 63,000-m² multi-let property was acquired in 2006 by Icelandic bank SJ1 for EUR 163 mln. The 10-storey asset, which consists of three buildings, is fully let on short term leases to 16 tenants including Regie der Gebouwen (the Federal Agency for public real estate matters in Belgium), Flemish government tenant IBBT, ING, Ghent University and Tele Atlas.

The vendor was advised by international real estate advisor Savills and DTZ.

'We are pleased to announce the closing of the Zuiderpoort transaction as this is the largest sale of a multi-let property on short-term leases in the country since 2008,' said Gregory Martin, managing director at Savills Belux. 'As the second biggest office market in Flanders, one of the three Belgian regions, Ghent is a popular destination for investors and it currently has the lowest office vacancy rate in the country, at approximately 4.4%.'

Frédéric Van de Putte, leading this transaction on behalf of DTZ, added: 'It has been an extremely complex transaction to structure as, besides the landlord and buyer’s interests, a dozen banks had to agree on the final settlement. Zuiderpoort has been the largest transaction over the last years in Belgium with a tripartite agreement between lenders, shareholder and buyer.'