Peakside completes first buy for new opportunistic fund

Peakside Capital has acquired a 75% majority stake in a 7,200 m2 office building, Square 41, in Frankfurt. The acquisition is the first investment by the new opportunistic fund, Peakside Real Estate Fund II (PREF II).

Prior to the transaction, the asset was jointly owned by German developer Red Square and an American financial investor, who is exiting the market. The financial details were not disclosed.

The asset is located in the heart of Frankfurt’s financial district and is extremely close to Frankfurt’s Old Opera and the renowned shopping high street of Goethestrasse.

Current tenants include institutions and corporates with a background in the financial industry, such as the European clearing house for SEPA and other banking transactions.

Peakside and Red Square are currently planning a number of asset management initiatives to fully lease up the building, including the development of a new underground car park and final fit-out of the vacant units. Since the start of the acquisition process, the partners have already been able to achieve a refinancing, which will extend until 2016, and lease up 10% of the vacant space, bringing the current occupancy to almost 70%.

Peakside and Red Square were advised on this transaction by Olswang, Valteq, HauckSchuchardt and Stibbe Luxembourg.