NorthStar Realty Finance Corp. announced that it has entered into a definitive agreement to acquire a Class A office tower located in Frankfurt, Germany for €540 mln.
This building - which is mooted as being the Trianon Tower - is one of the tallest buildings in Germany. It is approx. 68,600 m², 98.5% occupied and has a weighted average lease term of approximately eight years with two tenants rated "AAA" and "A" comprising over 70% of gross rents.
NorthStar Realty expects to earn an initial current yield of approximately 8.0% on its approx. €250 mln of invested equity. The tower is expected to be contributed to NorthStar Realty Europe Corp. (NRE) at the time of the spin-off from NorthStar Realty.
NorthStar Realty's Chairman and Chief Executive Officer, David Hamamoto, commented, "We believe this prominent office tower will be a great addition to NRE given its strong fundamentals, including being one of a very limited number of buildings in Frankfurt with greater than 40 floors, which demand premium rents in the market."