London-based asset manager Signal Capital has acquired one of the largest office buildings in Lisbon for €65 mln in one of the latest sign of booming investment levels in Portuguese real estate.
Cushman & Wakefield and JLL announced the sale last week of the 48,000 m2 'Entreposto' office building.
This is a property in the eastern part of Lisbon, located between the Parque das Nações (Expo) area and Lisbon's international airport.
Signal and Square Asset Management, acting as local operating partner, acquired the property from Portuguese conglomerate Grupo Entreposto. C&W advised for the vendor and JLL acted on the buy side.
The deal is the largest single-asset investment transaction so far this year in Portugal. Largely thanks to the Entreposto deal, volumes in the office sector already stand at €100 mln.
C&W has forecast that total volumes for the first half of 2017 could reach €800 mln, the third-best performance ever. While foreign investors are driving the market, domestic capital accounts for 30% of activity.
Entreposto Gestão Imobiliária, the vendor's real estate business, will remain a long-term tenant in part of the building. Other tenants include AXA, C. Santos (Mercedes-Benz), Aldi and Adecco.
According to Luís Rocha Antunes, head of C&W’s capital markets group in Portugal, the Lisbon office market presents several value-add opportunities on the back of an improving occupier market. 'Lisbon is an increasingly appealing destination for near shoring and high end business process outsourcing, and this strong tenant demand feeds sustainable rental growth,' he said.
Fernando Ferreira, head of the local investment team of JLL, added: 'The Portuguese investment market has grown in size, number of investors and appealing opportunities. We believe this is a sustainable trend that will continue in the forthcoming years with an increasing number of active international and local investors, thus creating a more liquid and interesting market.'
