BENELUX DEALS: Allianz cash injection keeps Dutch residential on top

The €600 mln injection by Allianz Real Estate and an unnamed Asian investor into Dutch landlord Vesteda in April has ensured residential was the most active sector amid fairly low-key investment activity in the Benelux region since the start of 2015.

Vesteda owns 23,000 residential units, valued at €3.7 bn, in the Netherlands. Prior to the Allianz-Asian transaction Vesteda's investors were all Dutch institutions. The equity infusion enables Vesteda to compete more effectively with the increasing number of internationally backed platforms, such as Round Hill and Patrizia Immobilien, which have entered the arena in the last 12-18 months.

PropertyEU Research has included Allianz-Vesteda in our round-up of the largest Benelux real estate investment transactions from January to mid-May even though it took place at the company rather than as a direct property level. This is because it involves a significant share of a sizeable Dutch residential portfolio moving into foreign ownership.

The largest pure direct property investment in the Benelux for the first four and a half months of 2015 took place in Brussels where Belgian REIT Befimmo acquired the office-led project, Gateway, at Brussels Airport from developer Codic for €140 mln.

The next 18 top deals for the Benelux region were between €20 to €66 mln, a range market watchers tend to view as a sign of a healthy market as the occasional €100-plus transaction, while eye-catching, can skew volumes and give a misleading impression of overall activity over the medium to long term.

Dutch trends
Our transaction round-up underlines that the Netherlands, the largest of the Benelux countries, is clearly seeing more transactions than Belgium and Luxembourg. And so far this year the Netherlands has captured the largest investment with the Allianz-Vesteda equity infusion.

The Dutch residential market attracted further foreign capital in the first five months of the year with London-based Round Hill carrying out two transactions totalling just under €100 mln and LaSalle buying 3250 units in the city of Maastricht for €35 mln.

The Dutch office market, which was once the European poster-boy for oversupply, is back in vogue, and attracted both opportunistic and institutional money in the period under review. In April, US private equity group Lone Star Funds - the quintessential distressed investor - acquired the 34,000 m2 INIT office building in Amsterdam which houses newspaper publisher De Persgroep. Lone Star paid about €58 mln for the property for which the vendor, Pramerica, had paid €100 mln in 2007.

Two months earlier Singapore-listed First Sponsor Group and a number of Singaporean private investors purchased the 12,500 m2 Zuiderhof I office building in the South Axis, Amsterdam’s central business district, for just over €51 mln.

The Dutch logistics sector saw four significant transactions. The buyers in three deals were all cross-border players: Delin, WP Carey and MStar.

Belgian market
Aside from Gateway, the other key transactions in the Belgian market were US private equity firm KKR expanding its European property holdings by acquiring the Radisson Blu hotel in Antwerp, and AXA Real Estate and Ghelamco Invest buying office buildings in Brussels.

In January AXA Real Estate divested the Vander Elst office building in the Belgian city of Leuven to the AXA Insurance Group for around €40 mln and acquired an office building in Luxembourg from Deka Immobilien for €32 mln.

For more, see the Benelux special report in the June edition of PropertyEU Magazine