US fund manager Northwood Investors has significantly expanded its French portfolio with the acquisition of the Pointe Métro office building located in Gennevilliers, near Paris from developer-investor Hines.
US fund manager Northwood Investors has significantly expanded its French portfolio with the acquisition of the Pointe Métro office building located in Gennevilliers, near Paris from developer-investor Hines.
Hines, which bought the asset in October 2008 from developer Nexity, said the asset was sold by its European value add fund, HEVAF, which launched in 2005 with €287 mln of equity commitments from a group of European institutional investors.
The 23,753 m2 office building was designed by architects Jean-Paul Viguier & Associés and developed by Nexity as a campus-style project with three independent but related buildings, as part of the larger Coeur de Seine development project. Phase II was later on sold to French listed property firm Gecina.
Delivered in 2010, Pointe Métro is fully let to publishing Group Prisma Media. Catella Property and JLL brokered the deal.
Northwood, a New York-based privately-held investor with $4 bn of assets under management, entered Europe in 2012 with the acquisition of the Défense Plaza office building in Paris, which was financed with a €210 mln loan from Aareal and Morgan Stanley.
The investor has recently carried out a number of acquisitions in the UK and Continental Europe, including the purchase of a Four Seasons hotel in Prague and the major €800 mln acquisition of Highcross, the owner of 7 million sq ft (650,000 m2) of office and industrial property across the UK.
In France, the Group last year bought a portfolio of 10 office/industrial parks in major regional cities offering a total leasable area of 2.8 million sq ft.
While historically most Northern American investors coming to Europe have had an opportunistic focus, recent entries of the likes of Northwood and Northstar points to the emergence of a more institutional-quality type of US capital fleeing the expensive home market to buy on the old Continent at a much lower cost of capital.
‘I believe we will see a wave of core and core plus capital coming over from North America,’ said a market expert who wished to remain anonymous. ‘US institutional-quality players with easy access to the equity markets will be competing with the traditional US opportunistic funds, which meanwhile have been forced to lower their return targets in Europe. In fact, much of the capital recently spent in Europe by the likes of Blackstone has had more of a core plus risk profile than a true opportunistic focus,’ the source added.