Henderson Park and funds managed by Swiss Life AM have agreed terms to acquire Kustermann Park, an office complex in Munich. The property is located directly adjacent to Munich’s Werksviertel, which is a sought-after neighbourhood experiencing an important regeneration across a total area of 390,000m², where more than 7,000 new jobs will be created and 1,000 new apartments are currently being developed.
Kustermann Park totals 74,000m² of office space across two buildings and 889 parking spaces. Henderson Park is acquiring Rockwell Haus, a 42,000m² building which is fully leased to a range of tenants including City of Munich, TDK and Regus. Two of the main tenants are due to vacate the property at the end of the year offering Henderson Park the opportunity to invest further capex into the building and subsequently bring a total of 12,000m² of refurbished office space back to the market in 2020.
Swiss Life AM is acquiring Brinell Haus, a 32,000m² fully-leased property with a weighted average lease term of 14 years. The City of Munich, which will occupy 40% of the asset, has signed a 20-year lease for the building following a refurbishment to accommodate increased tenant demand.
Nick Weber, Founding Partner of Henderson Park, said: “Structuring this transaction alongside Swiss Life AM allowed us to present a compelling offer to the vendor while enabling us to invest in a well-located office building in Munich. Rockwell Haus offers both the opportunity for active asset management, by taking on the refurbishment and through leasing up vacant space, as well as high-quality long-term income from the pre-leases that have already been agreed. Munich is an affluent city and one of Europe’s top-performing office markets, being consistently characterised by high demand and low vacancy rates, and this acquisition gives us a great entry point into this important market.”
Maureen Mahr von Staszewski, senior pan-European fund manager at Swiss Life Asset Managers, says: “Given low vacancy rates, it can be difficult for investors to gain exposure to the Munich office market. Therefore, we are delighted to have had the opportunity to work with Henderson Park on this deal. This transaction supports our strategy to invest in core European locations where we believe we can offer investors attractive long-term returns in the current low-interest-rate environment.”