Technopolis will invest €39.0 million in expanding the Tampere Yliopistonrinne campus. The expansion is due for completion in March 2016.
“The campus is located centrally between the railway station and the university. We have a 25% pre-let rate for the expansion, with the largest agreement covering the next six years,” says Keith Silverang, CEO of Technopolis. “The financial occupancy rate of the first section of Yliopistorinne is currently 100%, so we are confident about starting the expansion.”
Technopolis’ occupancy rate in Tampere is 98.1%, and the occupancy rate in the region’s office market was 90.6% at the end of 2013. Demand in the downtown area is excellent, and no other office properties are currently under construction in the area.
The rentable space of the expansion is 11,900 m², and once complete, the rentable space of the campus will be approximately 30,000 m². The existing restaurant and reception will also serve the expansion, which will make the provision of services more efficient. The expansion also includes parking for 240 cars.
The net initial yield of the expansion is estimated at 6.7% and the stabilized yield at 7.2%, while the market yield requirement is 6.9%. Starting up the expansion project requires the purchase of a plot from the City of Tampere, which is expected to take place by the end of September. The purchase price of the plot and the previously realized design and preparation costs of the project are included in the total investment.