Segro sells office building in Warsaw to Commerz Real

UK REIT Segro has agreed the sale of Tulipan House in Warsaw to German investor Commerz Real for EUR 60mln. The transaction reflects an initial yield of 5.9% and encompasses 17,898 m² of class 'A' office space. The property is earmarked for Commerz Real’s Hausinvest global fund.

Segro acquired the site in December 2005 as part of its EUR 20mln acquisition of the Central European property development arm of Dutch firm Grontmij. Given the location of the site - in one of Warsaw’s prime office areas - the development of a high-quality office building represented the best opportunity to maximise value, Segro said. Construction was completed in June 2008. Tulipan House is currently 90%-leased to international tenants and leading Polish companies including Ernst & Young, Legrand, TP Emitel (Polish Telecom), Kodak and ACP Pharma.

Ines Reinmann, Segro's chief operating officer for Continental Europe, said: 'Following the development and letting successes for Segro in Central Europe over the last two to three years, this marks our first major recycling of capital in the region. This Warsaw site had always been seen as a trading opportunity; with the strength of the local investment market and the high level of lettings achieved before completion, our decision to crystalise the value which has been created was a natural one.'

Segro was advised by Jones Lang Lasalle and Clifford Chance.