AXA Real Estate announced that it has agreed to acquire a portfolio of up to 13 government-let office buildings in Barcelona, as part of a sale and lease back transaction with the Generalitat de Catalunya for €172 million. The acquisition of 11 of the properties is expected to complete on Friday, 28 June 2013, while the remaining two are subject to further due diligence and expected to close in the middle of July. This is AXA Real Estate’s first Spanish office acquisition since the financial crisis in 2008 and has been made on behalf of the AXA insurance companies.
Under the terms of the transaction, the Generalitat will continue to occupy the buildings, having signed a new 20 year lease providing a total annual rent of €16.2 million which is linked to CPI.
The office buildings are all located in the central business district or city center of Barcelona and comprise a total floor area of over 105,000 m², including parking and storage. AXA Real Estate won a competitive public tender process to acquire the portfolio.
Following the acquisition, AXA Real Estate will manage a €1.3 billion portfolio of assets in Spain, of which €540 million are in Barcelona.
Commenting on the acquisition, Pierre Vaquier CEO of AXA Real Estate said: “We have been actively looking to make acquisitions in the Spanish real estate market since the beginning of the year, having felt that the risk of a Eurozone break up had abated and that the economic prospects of the country had improved sufficiently. The acquisition of the Generalitat portfolio is typical of the type of value-add transaction we want to undertake, being core quality offices that are well located within a major city and let on long leases to strong, preferably government backed, tenants, but which offer the potential for capital appreciation given the early stage of the Spain’s recovery.”
Hermann Montenegro, Head of Asset Management and Transactions, Spain at AXA Real Estate, added: “This is an important acquisition for AXA Real Estate. It is a prime example of our ability to source and execute complex investment opportunities on behalf of our clients by leveraging AXA Real Estate’s strong network of local teams. The assets are very well located, let on long leases to a government tenant and seek to produce a good level income.”
Source: AXA Real Estate