Investment manager Barings has acquired a fully pre-let hotel and office development in Stuttgart, Germany, from developer Weisenburger Projekt.
The forward funding deal was executed on behalf of a separate account mandate dubbed SIS, run for Stuttgarter Insurance Group.
Due to complete construction in Q4 2020, the property will comprise a brand new 7,000 m2 hotel with 198 rooms and 3,800 m2 of prime grade A office space over a common underground garage.
'Once completed, the property will be a modern building that meets the growing demand for hotel beds and office space in the Stuttgart area,' said Christoph Wittkop, managing director, real estate country head Germany at Barings.
'The microsite of the property is currently undergoing major development, including the construction of new office properties for Daimler and Allianz. The property will provide long-term stable earnings, and therefore supports our customer's German and European core strategy,' Wittkop added.
The hotel component has been pre-let to Novum Hospitality on a 25-year lease, and will be operated as a niu hotel (the niu Kettle), while the office has been let entirely to HWS & Co on a ten-year lease.
The property is located directly next to the government council in the Stuttgart borough of Vaihingen - 10 km south west of the city centre.
Gunther Deutsch, managing director, head of real estate transactions Europe for Barings said: 'We have a long standing track record acquiring and managing buildings in Stuttgart, and we are very positive on this particular submarket development.
'Aside from Germany we are very interested in acquiring core office, hotel or logistics buildings in Sweden and Finland that will deliver some value enhancement possibilities over a longer holding period for this separate account.'
GSK Stockmann acted as legal adviser for Barings. The Barings Munich team, as well as the central development team, managed the transaction.
