Meyer Bergman, the investment manager specialized in European retail properties, and global real estate developer Thor Equities have acquired a multi-use building in the luxury brand hot spot on Paris’s Avenue des Champs-Elysées for circa €250 million. This is the second time that Thor and Meyer Bergman have joined forces, with the companies partnering to purchase London’s Burlington Arcade in 2010.
The 10,200 m² Haussmann building at 65-67 Avenue des Champs-Elysées is fully leased, with the street-facing retail units occupied by world-class brands Nike and Tommy Hilfiger. While the stores are the main value drivers of the property, its upper levels comprise offices and high-end residential units to the rear. The building retains its historic stone facade and features two interior courtyards, providing charm and character.
The Champs‐Elysées is a prime retail location that has sustained strong international retailer demand because of Paris’s historic lead as a creative hub for global fashion. The Champs-Elysées benefited from the grand openings of Marks & Spencer, Abercrombie & Fitch, and Banana Republic in 2011 and has remained in the spotlight in 2012 with the opening of Levi Strauss, Kusmi Tea, and the refurbishment of Hugo Boss flagship stores. Other brands, including Apple, are looking for space on the Champs‐Elysées.
Markus Meijer, Meyer Bergman’s Chief Executive, said: “This gem of a property is located in one of the most visited retail destinations globally and our tenants count premium and luxury brands, notably Louis Vuitton, as their neighbors. This and a number of our recent transactions highlight our current focus on defensive high street locations in key European cities. We see great potential in this mixed-use asset that not only offers steady income but also attractive upside potential through our asset management initiatives.”
The joint venture that purchased the renovated building in an off-market transaction is majority owned by Meyer Bergman’s second value-add fund, Meyer Bergman European Retail Partners II (MBERP II). The fund passed the halfway stage in raising €500 million of equity in October and its roster of investors includes Canadian and Nordic pension funds, US endowments and funds of funds.
MBERP II targets properties with a dominant market position or in prime locations. This has translated into the acquisition of Whiteleys Shopping Centre in London’s Bayswater district, stores on the premier shopping destinations of Copenhagen and Madrid, and the Westfield Broadway shopping center development in Bradford, northern England.
Source: Bellier Financial