Paris-based fund manager AEW Europe has acquired a 2,900 m2 office building in the City of London for £18 mln (€25 mln).

Paris-based fund manager AEW Europe has acquired a 2,900 m2 office building in the City of London for £18 mln (€25 mln).

AEW Europe purchased the freehold office building at 65-68 Leadenhall Street on behalf of its Europe Value Investors Fund (EVI).

The investment volume represents a net initial yield of 4.9% and a reversionary yield of 6.25%.

AEW Europe said the multi-let building will benefit from the imminent Crossrail train link as it is located close to Bank, Aldgate and Liverpool Street stations. The property is 99% let to a range of tenants from the insurance, shipping and legal sectors.

This is EVI's second asset in the City of London following the recent purchase of 24-28 Martin Lane in East London.

AEW Europe said that it will implement a targeted asset management strategy and expects to increase net operating income through reversionary rental growth combined with the refurbishment of existing office space and communal areas.

AEW Europe Value Investors Fund has a target investment capacity of €700 mln and, at second close, has raised in excess of €240 mln of equity commitments. The fund is deploying a core-plus and value-add acquisition strategy, focusing exclusively on office assets and concentrated predominantly in Germany, France and the UK.