Hannover Leasing is joining forces with a group of institutional investors as well as an unnamed Asian player to acquire the 72,000 m2 Covent Garden office asset in Brussels for an undisclosed amount.
Hannover Leasing is joining forces with a group of institutional investors as well as an unnamed Asian player to acquire the 72,000 m2 Covent Garden office asset in Brussels for an undisclosed amount.
The three parties, which will each hold an equal stake in the building, have financed the acquisition with 50% equity and 50% debt provided by Landesbank Hessen-Thüringen Girozentrale. The German lender is a major shareholder in Hannover Leasing with a 49.34% stake.
Although financial details were not disclosed, the asset is believed to be worth well over €300 mln.
Hannover Leasing is buying the asset from London-based private equity investor Evans Randall which in turn acquired it in October 2007 from its developer Immobiliere du Royal Rogier for €272 mln. At the time the complex was only partially let.
The property comprises a low-rise, nine-floor building and a high-rise, 26-floor building, both connected on the ground floor by an atrium with a glass roof, and a three-level underground parking garage and archive spaces. The office space is fully occupied by the European Commission and several of its agencies on a long-term basis. The two elements of the asset provide a net yield of 4.95% and 5.5% respectively for the low-rise and the high-rise part.
'The prime location, the high building quality, and the long-term lease to the European Commission and its agencies make this property an interesting investment property for investors with a long-term horizon,' said Andreas Ahlmann, managing director of Hannover Leasing.
Hannover Leasing and its Asian partner were advised by Loyens & Loeff, Rödl & Partner, Drees & Sommer and DTZ. Hannover Leasing will be in charge of the asset management.
Covent Garden is Hannover Leasing's second large transaction in Brussels following the purchase of Belair for €300 mln in June 2013. That deal - also carried out in partnership with an institutional investor from Asia - marked the largest real estate transaction in Belgium over 2013. German lender Aareal Bank provided €152 mln in financing for the acquisition.