IREIT Global Group has agreed to buy two office buildings in Berlin for €144.2 mln, representing a net yield of 7.1%.
IREIT Global Group has agreed to buy two office buildings in Berlin for €144.2 mln, representing a net yield of 7.1%.
The connected properties on Schrieberhauer Strasse, in the city’s Lichtenberg district, were acquired from HFS Immobilienfonds Deutschland 6.
The buildings are occupied by Deutsche Rentenversicherung Bund (DRB), the largest of Germany’s 16 federal pension institutions.
IREIT said it was attracted to the building by the relatively high yield in an office sector where the average level stands at 6.3%, its lowest in 10 years. Weighted average office rents in Berlin have increased to €14.10 per m2 in Q1 2015, representing a five-year compound annual growth rate of 2.9%.
The company has announced a rights issue to raise €80 mln to finance the purchase, with the balance provided through a bank loan facility.
Itzhak Sella, CEO of IREIT, said: 'This is a significant acquisition for us as it demonstrates our ability to acquire a quality asset at an attractive yield that will enhance our portfolio and strengthen IREIT’s long term growth and distribution income to our unit holders.'
The acquisition brings IREIT´s total portfolio value to €438 mln and its net lettable area to 200,603 m2.
