Catalyst Capital, the European real estate investment and fund management firm, has completed the acquisition of €200 mln of assets in Germany, France and Poland for its new Catalyst Core Plus European Property Fund (CCPEPF), a €1 bn evergreen real estate fund.
Catalyst has made six investments in Frankfurt, Berlin, Leipzig, Paris, Wroclaw. This included acquiring three new autobahn service stations in Germany, with lease lengths ranging between five and 25 years.
Kean Hird, partner of Catalyst and fund manager, said: 'All six investments provide stable, long-term income, which will generate attractive returns for our investors. We were able to acquire them within a few months of the first close of the fund because of our network of on-the-ground teams across Europe and understanding of local European markets.'
Catalyst announced the first close of CCPEPF in October 2017 with equity commitments of more than €455 mln from international institutional investors.
Yields range between 5.5-6.7%
The yields Catalyst paid for the six investments range between 5.5% and 6.7%. In Frankfurt, Catalyst has acquired the Fiat Campus in Frankfurt’s Eastend, close to the new European Central Bank headquarters, from LaSalle Investment Management at a net initial yield of 6%.
The property at Hanauer Landstrasse comprises 13,000 m2 of space, of which 7,500 m2 is to be re-let after refurbishment works have been completed.
In Berlin, Catalyst has acquired a cash and carry market in Ahrensfelde from a group of investors represented by Odyssey Real Estate at a net initial yield of 6%. The property totals 15,500 m2 and is fully let to a self-service wholesaler, Selgros.
In Leipzig, Catalyst has acquired Pösna Park, an established 57,000 m2 retail park, at a net initial yield of 6.3%. Almost 60 tenants occupy the park, including well-known anchor tenants such as Kaufland, Sconto, Netto, Deichmann and DM. The two main tenants, Kaufland and Sconto, have extended their leases until 2032 and 2028 respectively.
In Paris, Catalyst has acquired the A City building in Rueil-Malmaison (pictured), one of the key submarkets of La Défense, from Valream at a net initial yield of 6.3%. The complex, totalling 8,500 m2, comprises a fully-refurbished, multi-let office building and a 22-unit convenience shopping mall and is 97% let.
Highest yield in Poland
In Wroclaw, Catalyst has bought Nobilis Business House from Echo Investment at a net initial yield of 6.7%. The 16,900 m2 building, located on Marii Sklodowskiej-Curie street in Wroclaw, was completed in late 2016 and is 75% let to companies such as Onet Group, City Space, PPG Deco, Smith & Nephew and a Synexus medical centre. Catalyst Capital has paid an initial €36 mln.
The sixth investment, the three service stations in Germany, are located in Zeven-Elsdorf, Ratingen and Pilsting and have been acquired at a net initial yield of 5.5%. Each asset is let on a 25-year lease to Tank & Rast, the leading service station operator in Germany with around 360 petrol filling stations and 410 service areas.
Using leverage, CCPEPF will have an initial €1 bn to invest in income-producing assets in every commercial real estate sector, including hotels and infrastructure. Geographically, CCPEPF will invest in the countries in northern Europe where Catalyst has an established presence, Germany, Poland, the UK and France.
As an evergreen fund, CCPEPF will have an indefinite life. Its final close is expected to be in the first quarter of 2018.
Catalyst is currently investing for its second European real estate fund, Catalyst European Property Fund II, which closed in August 2016 with €1 bn of spending power.
