A new platform established by Poland's Griffin Real Estate has agreed to acquire the West Link office project in Wroclaw from listed developer Echo Investments.
Under the agreement, the Griffin Premium RE platform will acquire the 13,900 m2 building once it is completed in 2018.
In addition, Griffin Premium RE is to indirectly provide 25% of the capital required to finalise two of Echo's projects in Warsaw - Beethovena – phase I and II; and Browary Warszawskie – phase J. This agreement indirectly entitles Griffin Premium RE to 25% of the profits of a sale of the assets, and gives it the right to make the first offer for the assets.
'The deals are in line with Echo Investment's asset-light strategy that enables divestments of buildings leased up to a satisfactory level and makes it possible to invest this cash to grow the business further,' said Nicklas Lindberg, CEO at Echo Investment. 'It allows faster capital turnover and higher rates of return.'
The financial details of the transactions were not disclosed.
Griffin Real Estate has owned 65% of Echo Investments since 2015. Last year Griffin worked with South African-listed Redefine Properties to spin off Echo Investment's standing assets into a new listed vehicle, Echo Polska Properties.
In December 2016 Griffin Real Estate created Griffin Premium RE by spinning off six office buildings and three mixed-use properties, which until then had been held in Griffin's own portfolio. The assets are located in five Polish cities: Warsaw, Wroclaw, Lódz, Krakow and Katowice.
