Pan-European investor and asset manager M7 has sold an office building in Porto, Portugal, on behalf of the M7 Portuguese Active Fund (M7 Poraf), to a Portuguese real estate investment fund.
Financial details of the off-market deal were not disclosed.
Situated in Porto, Portugal's second-largest city, the six-storey property comprising a total floor area of 3,826 m2 and 58 underground car parking spaces is located in a prime commercial and residential part of the city.
Eduardo Craveiro Lopes, senior asset manager at M7, commented: 'This sale is in line with the fund’s business plan and enables us to generate significant returns for investors.
'Additionally, it demonstrates our ability to successfully execute our asset management strategy, in spite of the challenging market environment. It is an excellent result for the fund and further illustrates the strong investor appetite we are seeing in the Portuguese real estate market.
'M7 remains focused on executing other asset management initiatives as we continue to add value to the vehicle.'
Having acquired the asset in October 2018 - the first investment to be completed on behalf of the fund - M7 said it identified an opportunity to improve the quality and appeal of the building. Asset management initiatives included repairs and maintenance work, as well as upgrading the building’s lobbies, common areas and vacant space.
M7 subsequently attracted a number of new tenants and were able to extend two existing lease agreements, which increased the income at the asset by 35%. The asset is let to a diverse mix of occupiers, including the anchor tenant, a business operating in the IT sector which runs a leading e-commerce platform.
M7 Poraf is a discretionary fund that is now fully invested in a portfolio of office, retail park and industrial properties in key regional Portuguese markets totalling 164,596 m2.
