Finnish pension-insurer Ilmarinen has expanded its international real estate investments to the UK by acquiring a 50% holding in a new office property in Manchester from developer Allied London.
Financial details were not disclosed, but the property was valued at around £200 mln (€229 mln) earlier this year.
'Manchester’s population is growing and its economic outlook is positive. The ongoing Brexit negotiations are not expected to have any significant impact on Manchester city centre’s office market,' commented portfolio manager Mikko Antila, who is in charge of Ilmarinen’s international real estate investments.
'In addition, the long and diversified lease profile of the building accompanied with a historically low valuation of the pound provides solid defensive attributes to the investment.'
The office property, dubbed No.1 Spinningfields, is located in the western part of Manchester’s city centre. The just-completed 19-storey office building comprises some 29,000 m2 and has a 95% occupancy rate. The largest tenant is the auditing and consulting firm PwC.
The co-owner in the property is a global institutional investor with experience in the UK real estate market.
After acting as the buyers’ advisor in the acquisition, Schroder Real Estate will also be responsible for the management of the property.
Ilmarinen and Schroder Real Estate have previously co-operated in real estate investments in continental Europe.
The transaction supports Ilmarinen’s investment strategy, which is to diversify its real estate portfolio internationally as part of profitable and secure investment operations. In addition to Finland, Ilmarinen has previous direct real estate investments in Germany, Belgium, the Netherlands and the United States. However, Finnish real estate investments will continue to make up the core of its real estate portfolio going forward, the insurer said.
