TPG closes acquisition of CEE developer TriGranit

US-based global private equity giant TPG has completed the acquisition of CEE real estate developer Trigranit and a large part of its €7 bn portfolio of standing assets and projects.

TPG Real Estate intends to commit additional capital to fund future growth and to strengthen TriGranit’s balance sheet 'to create a leading real estate investment, development and management platform in central Europe'.

With offices in Budapest, Warsaw, Krakow and Bratislava, Trigranit has €3 bn of assets under management and a development pipeline valued at €4 bn. The transaction, which is estimated to be in the region of €500 mln, covers the Trigranit development and asset management platform as well as the developer's holdings in Poland and Slovakia, plus some development projects in Trigranit's native Hungary and Croatia.

The senior management team will remain with the company after the transaction.

'This transaction represents the culmination of over a year of work to acquire a high-quality platform and real estate via a corporate carve-out,' said Anand Tejani, Partner of TPG Real Estate.

'The new TriGranit will manage a much wider scope of activities than before. As an integrated real estate platform, we will not only focus on development and management of retail and office projects, but also acquisitions of high-quality assets. Poland and the capital cities in Central Europe remain our main area of focus. We see enormous potential in the countries in this region due to their favourable macro environment and real estate trends,' said Árpád Török, CEO of TriGranit.

TPG was advised in the transaction by law firm Dentons.

Gránit Management
Trigranit's flagship WestEnd retail and office centre in Budapest and some other projects are being retained by Hungarian businessman and Trigranit's majority owner Sándor Demján.

WestEnd Centre - 50,000 m2 retail; 17,000 m2 office and a hotel - is 'unique in the world' as is being developed on a brownfield site, Demján said. The company managing these projects will continue to operate under a new name, Gránit Management.

Besides Demján, Trigranit was owned by Sándor Csányi, Peter Munk and Vienna-listed Immofinanz. As part of the deal, Demján and Csányi acquired the shares held by Munk and Immofinanz.

Comment
Explaining the decision to sell the majority of Trigranit to TPG, Demjan recently said: 'We founded TriGranit 20 years ago and it has grown into the region’s leading real estate company. I believe TPG Real Estate is a perfect buyer, as its extensive experience can carry on the Trigranit legacy. It is a great honour that one of the world’s largest investors has selected our company and its management in Europe.'

TPG Real Estate is the real estate platform of TPG, a leading global private investment firm with some $75 bn of assets under management and 17 offices around the world. TPGRE includes both TPG Real Estate Partners, its equity investment platform, and TPG Real Estate Finance Trust, its debt origination and acquisition platform. Collectively, the two platforms have in excess of $6 bn of assets under management across TPGRE and other TPG-sponsored vehicles.