AEW Europe is acquiring the Champs-Elysees flagship store of cosmetic retailer Kiko Milano in Paris for almost double the price at which the property traded 18 months ago when it was home to the famous nightclub Le Queen (pictured).
Paris-based fund manager AEW exchanged contracts with the vendors, Thor Equities and Invesco Real Estate, to acquire 102 Champs-Elysees for €115 mln on Wednesday. Completion is expected next week.
The deal comes about 18 months after Thor, the New York-based urban real estate and retail specialist led by Joseph Sitt, bought the property as a value-add investment for €64 mln.
The investment volume at the time reflected the fact that the building needed upgrading and that, as a result, Le Queen was paying under the market rent for such a high-profile location in Paris.
There followed an 18-month value-add programme to reposition the asset, which is located on the prestigious Avenue des Champs Élysées. Thor Equities and its joint venture partner, Invesco Real Estate, fully renovated the former 25-year-old Le Queen nightclub into a prime retail flagship store, which is now 100% leased to international cosmetics brand Kiko Milano. This transformed the status of the property from value-add to stablised and allowed Thor and Invesco to exit well before the normal three to five-year holding period.
Bert Crouch, managing director – portfolio manager, structured investments at Invesco Real Estate comments: '102 Champs Élysées was an exciting opportunity for us to acquire an under-utilised asset in an extremely well-located position and turn this into a prime institutional quality retail asset thus capitalising on a highly coveted retail address. Such properties on the Champs Élysées are rarely-traded and we were delighted to partner with Thor Equities once again, in conjunction with our on-the-ground team in Paris, to actively manage this property, create more value-add for the asset and ultimately for our higher-returning strategy.'
Joseph Sitt of Thor Equities, added: 'We continue to believe strongly in the Paris real estate market, particularly along prime retail corridors such as the Champs Élysées and Boulevard Haussmann, which are continuing to attract large numbers of international tourists as well as local shoppers.'
Knight Frank acted for Invesco Real Estate and Thor Equities, while Savills acted for AEW Europe.
