Technopolis has signed an agreement to acquire the Falcon Business Park in Otaniemi, Espoo, from companies owned by a fund managed by Aberdeen Asset Management.
The company announced its intention to acquire Falcon on October 11, 2013, and that it was investigating the possibility to execute the acquisition as a joint venture with a co-investor. The negotiations with the co-investor have ended, and Technopolis will execute the acquisition alone. The total investment, including transfer taxes, is €77.5 million, and the closing of the transaction is expected to take place in two parts before year-end 2013.
The closing of the deal is subject to the fulfillment of a number of normal conditions. The acquisition will be financed using Technopolis’ existing credit facilities.
Technopolis plans to integrate Falcon and Innopoli into a single 60,800 m² campus with a shared infrastructure, property management and services.
The initial yield on the Falcon campus is estimated at 7.4% and the stabilized yield at 7.8%. The market yield is 7.0%. Technopolis will get a three-year rental guarantee on vacant space from the sellers. The guarantee will raise the effective financial occupancy rate to approximately 97% at the point of purchase and will gradually decline during the guarantee period. The company estimates that the Falcon acquisition will increase the Group’s net sales in 2014 by €6.7 - 7.0 million and EBITDA by €5.6-5.9 million.