AXA Immoselect sells near Paris at big discount

AXA Real Estate’s Immoselect open-ended fund in liquidation has divested the Perspective Defénse office scheme to the north of Paris for a bargain price.

The sales price of €126.5 mln represents a 21% discount to the asset’s appraised market value per end-April 2013, and a discount of nearly 30% to the asset's value only a year before.

‘The purchase price reflects the property’s challenging rental situation with an average remaining lease period of only 2.2 years and associated leasing risk for about 50% of the rental space,’ AXA Real Estate said in a statement.

It added that the Colombes market of Paris - where the asset is located - also posed a challenge due to the rising level of supply in the near future.

‘We did not see a possibility to increase significantly the profitability of the property in the short to medium term,’ it noted.

AXA Immoselect bought the asset in May 2008 from a joint venture of developer Altarea Cogedim and AXA for €170 mln. The building provides 27,000 m2 of office space at 1-9 rue du Débarcadère and represented the largest single asset in the fund’s portfolio. It was still valued at €175 mln at end-April 2012.

AXA announced in late 2011 that it planned to liquidate its frozen €2.5 bn Immoselect fund. Earlier this week, the fund sold a portfolio of Dutch secondary properties for €140 mln, a 40% discount to the most recent independent valuation.

Czech investor-developer PPF Real Estate confirmed to PropertyEU that it is the buyer of the portfolio, which includes seven properties - comprising six offices and one retail asset.

The portfolio includes the headquarters of Dutch fashion company Mexx in Amsterdam, a 27,000 m2 office property in Arnhem and a 19,000 m2 office complex in Rotterdam.

Also this week, AXA Immoselect sold the Grafenberger Höfe building in Dusseldorf for €30.5 mln, representing a 21% discount to the asset’s most recent market value. The low sales price reflects the asset’s letting risk as the main tenant plans to vacate the building in December 2018.

The property was valued at €42.5 mln at end April 2012.