The HILF Euro Office JV has been established by Hyundai Investments and La Francaise to invest in medium size modern offices in the established business districts of targeted cities in Germany, Belgium, the Netherlands, Luxembourg and Ireland.
The risk profile of the portfolio is core/core+.
The joint venture, which is represented by La Francaise Real Estate Managers, has acquired a fully let office building in the city of Essen. The deal was based on a sale-and-leaseback transaction with RWE, which is one of the largest energy suppliers in Germany. The duration of the lease is 17.5 years.
The property is located at Altenessener Str. 27 in the north of the city center of Essen and is part of the RWE Campus, which includes several office buildings which are owned by or let to RWE.
The six-storey office property, completed in 2009, offers quality and modern office space. The areas offer a ceiling with an integrated cooling system and heating with heat recovery. Besides the office area of 11,754 sqm, the property also includes a trading floor of 2,949 sqm which is home to RWE’s energy trading activities. The floor plans of the property also allow for multi-tenant use. Each floor can be divided in up to four different units of office space.
David Rendall, Managing Director of La Française Real Estate Managers said, “This is a new strategy which seeks to diversify the exposure of Korean investors to office assets which are modern and well let in both major and tier 2 European cities. The business plan for the joint venture will consider opportunities for asset management of the portfolio over a holding period of
up to 8 years. Further acquisitions are planned over the next 12 months.” Jens Goettler, Managing Director of La Française Real Estate – Germany concluded, “Through our German real estate investment center which works out of Frankfurt, Munich and Hamburg, we are able to cover the whole of the German real estate market. The asset’s prime location in Essen, home to Germany’s largest energy providers and where the economy is experiencing intensive growth, should contribute to supporting tenant demand.”