Euronext Brussels-listed REIT Befimmo has divested a 99-year leasehold on multi-tenant office property, the Blue Tower in Brussels, for €112 mln.
Located in the Louise area of the Belgium capital, the asset was acquired by Befimmo in 2013, for a price of €78.5 mln, which corresponded to a gross initial yield of 6.9%.
Benoît De Blieck, CEO of Befimmo, said: 'The Blue Tower is not only benefiting from the compression of property yields observed in the office market but also of the added value Befimmo created during the holding period.
'We have made this transaction at the right time in the life cycle of the building and of the overall Befimmo portfolio. It is a clear sign of the resilience of the Brussels office market, the quality of Befimmo’s portfolio and the capability of its teams.'
Befimmo said that the transaction was part of its asset rotation strategy, which will see the firm dispose of certain properties that have reached maturity, with a 'good prospect of crystallisation of value'.
The firm's H1 2020 financial report suggested that other similar transactions may follow.
At closing, the transaction, executed at fair value, will generate a net capital gain of some €22 mln in H2 2020, Befimmo said.
The gross exit yield amounts to 5.3% and the unleveraged internal rate of return on the investment amounts to 7.0%.
The proceeds will contribute to the financing of the ongoing development projects, and are expected to lower the firm's loan-to-value ratio by -2.5%.
