IBUS has sold two office buildings named Les Boréales in Courtaboeuf, a business park near Paris.
Les Boréales was acquired by IBUS in 2000 for an amount of 9 million and was sold last month for an amount of 7.9 million to a French, private investor. The two independent buildings have a total net lettable area of 5,026 m² and are located in Courtaboeuf, a business district near Paris.
Both buildings are currently entirely let. The properties faced substantial vacancy of around 25% in recent years, which has been solved by an active letting policy by IBUS.
The office market in Courtaboeuf is weak, which is reflected in downward pressure on rents, significant tenant incentives and substantial vacancy of space in the market.
The office park Courtaboeuf was set up for big ICT companies like HP, Microsoft and Apple. However, a number of these tenants has moved in recent years, implying that small and mid sized tenants are dominating the market these days. This has had a negative impact on the already weak market Courtaboeuf.
As a result of the fact that there is no short term expectation for a recovery of the market and the property is currently fully let, it was decided to sell the buildings.
Pepijn Morshuis, Managing Director at The IBUS Company: "The office market in Courtaboeuf, where the office properties named Les Boréales are located, has been struggling for years. We are satisfied that we have been able to eliminate the entire vacancy in the buildings. Real estate investors are focusing these days on 'core' assets of high quality in strong submarkets.
"Unfortunately, Courtaboeuf does not fall into this category. We do not rule out that the vacancy in Les Boréales will increase again over time. As a result, a sale of the assets at a later stage would probably result in a lower sales price. Therefore, we are satisfied that we have been able to finalize this process with an acceptable result. The realized sales price for the assets in combination with the annual achieved returns implies that investors have received their investment back and achieved a small, positive return."