Union Investment completes first deal in Kuala Lumpur

Hamburg-based investment company Union Investment has signed a contract to acquire the CapSquare office tower in Kuala Lumpur for its open-ended real estate fund UniImmo: Europa. The purchase prices amounts to around EUR 100 mln. This is the company's first investment in Malaysia.

The 41-storey tower is a grade-A office building which is due to be completed in the first half of 2010. The office block comprises some of 56,000 m² net lettable area within the CapSquare development and is expected to be fully let upon completion. The CapSquare project is an integrated development that comprises commercial, residences and retail outlets. Located on over 15.2 acres in midtown Kuala Lumpur, the project is expected to provide an impetus for rejuvenating the midtown area.

'The economy in Malaysia and the office market fundamentals in Kuala Lumpur are strong and vacancies tend to be low in this location and are continuing to decline. In a growing market with limited supply, strong demand and rental growth outlook, CapSquare is positioned as a very attractive investment opportunity,' commented Michael Montebaur, member of the Union Investment Management Board.

The company made its first investments in Asia in 2006 with the acquisition of two Properties in South Korea and it had a successful year in 2007 with several investments in Japan and Singapore.