Germany’s IVG has announced it has spun off its Officefirst Immobilien portfolio into a separate legal entity with plans to have it ready for capital market investors by the third quarter of this year.
Officefirst, which owns a portfolio of 97 offices valued at €3.24 bn, has hired Goldman Sachs to advise on the process in an attempt to take advantage from Germany's current buoyant property market.
'This is a very first step in a process aimed at preparing Officefirst for capital markets viability,' an Officefirst spokesman told PropertyEU. 'The next step will be to refinance the portfolio, something which we aim to complete by the third quarter. Once that is fixed the company is ready for any capital markets transaction, which may take the form of an Initial Public Offering, a M&A deal, a straight sale or any other form of deal you can think of, depending on the situation arising or on a special opportunity.'
There is no certainty that the deal will eventually take place, he added. IVG decided last year to spin off the portfolio into a separate unit.
Officefirst plans to establish itself as a 'leading player for office properties in Germany', according to Chief Executive Michiel Jaski.
The unit is already in talks with several banks to refinance its debt in the coming weeks to take advantage of low interest rates.
The company will focus on the six major German metropolitan regions, and namely Frankfurt, Munich, Hamburg, Stuttgart, Dusseldorf and Berlin, where about 96% of its portfolio is located. The 12 most valuable objects represent 58% of the portfolio value.
The package is 92% let, with revenues of roughly €207 mln a year and a weighted average remaining term of the leases of approximately 5.5 years.
