Private equity firm Park Street Advisors and German value-add specialist Around Town have formed a joint venture to acquire a retail-led portfolio of 28 assets in Germany for €39.2 mln.
The two firms have agreed the purchase of the remaining assets secured by the DECO 15 – Pan European 6 Limited CMBS Loan, managed by debt advisory firm Hatfield Philips International (HPI).
HPI was appointed the special servicer for the main loan of €86.7 mln in July 2011 following default on maturity. A consortium including EOS Partners, the Reuben Family and Deutsche Bank’s special situations group, arranged the loan through Deutsche Bank in 2007.
The 28 properties, located mainly in eastern Germany, comprise 26 retail assets with single tenants as well as two office properties let to the German federal agency job centre. The purchase price was below the last valuation of €44.6 mln, dating from November 2014, due to the location of the properties and the relatively short remaining lease terms.
HPI has been managing the disposal of the underlying properties securing the main loan in a sales process named Project Lucida. It had already reduced the outstanding balance to €64.9 mln through repayments and the disposal of five properties between 2013 and 2015 for €5 mln.
The portfolio gross rent is approximately €5.4 mln per annum and the occupancy rate is 96%.
Park Street Asset Management (PSAM) is the asset manager for the portfolio. It is expected to pursue a strategy of renegotiating leases and working with tenants to reinvest and modernise the properties.
PSA is in ongoing talks with lenders to secure senior financing.
Park Street was founded by former EMEA Head of Mortgage and Credit Markets at RBS, Pradeep Pattem in March 2014. Around Town's total portfolio spans 2.6 million m2 and was valued at €3.8 bn at the end of Q1 2016.
