DEGI International diversifies into Portugal (DE/PT)

DEGI Deutsche Gesellschaft für Immobilienfonds mbH is investing for the first time in an office building in Portugal’s capital. For a total investment of around €21.8 mln, the “Expo Tower” is being incorporated in DEGI INTERNATIONAL’s portfolio. The fund thus now owns properties in six of Europe’s major cities, and in South Korea.

Prime location in an up-and-coming submarket
The ellipsoidal Expo Tower is located in the established submarket of Parque das Nações on the former Exhibition Centre of 1998, featuring significantly more than 170,000 m² of office space, and located about five kilometres away from the city centre, in the immediate vicinity of Vasco da Gama bridge and the airport, and in contrast to the city centre it offers modern, generously dimensioned office buildings designed to international standards. The motorway can be reached with ease. Thanks to its location on the Avenida D. João II directly next to the new Gare do Oriente station, the property is conveniently placed for rapid-transit and long-distance rail travel. In the immediate vicinity there are office buildings, hotels and one of the country’s most popular shopping centres. The 13-storey building incorporates 6,216 m² of ultra-modern office space, plus underground parking for 105 cars. The property is complete, and secured by long-term tenancy agreements with Portugal’s leading travel agent Espírito Santo Viagens and Portugal Telecom Comunicações. “The current rents are below the market level for such high-quality office space, which is why we are upbeat about the property’s rental price potential. What’s more, office rentals in Lisbon are expected to rise in the medium term overall, due to continuing harmonisation of Europe’s office markets”, says DEGI Managing Director Malcolm Morgan, explaining the thinking behind this investment.

Portugal’s investment centre
Lisbon is the business centre of Portugal: around a third of the total population here creates almost half of Portugal’s GDP. More than three-quarters of direct investment from abroad in Portugal, for instance, goes to the capital. With approximately 2.5 mln m² of offices, Lisbon is Portugal’s largest market for office space. The average proportion of unoccupied premises is around 9.5%.

Source: DEGI

Related News