On June 28, 2007 Wereldhave completed the purchase in the United States of an office building in downtown San Diego, totalling 35,200 m², with 12 apartments, 1,400 m² of retail space and 752 parking spaces. The purchase price amounts to US $210 million (approx. €150 million).
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The property is located at Broadway 655, in downtown San Diego, at the corner of Kettner Boulevard. The Broadway 655 office building, completed at the end of 2005, is the first new class A plus office building in downtown San Diego since 1991. The building is located near the San Diego Federal and County Courts of Justice, and offers a dynamic view to the nearby harbour and the San Diego bay. The acquisition will be financed by debt, of which 50% in Euro, bringing the overall coverage of the Dollar exposure of the portfolio to 65% (previously 70%).
Today, the office is 80% leased to several tenants with long term leases. Amongst these tenants are several law firms and financial services institutions. Only 12% of the leased floor space will expire prior to 2015. Wereldhave expects to lease the remaining floor space before the end of 2007. The net initial yield when fully let amounts to 5%.
This acquisition is Wereldhave's first property investment in the West Coast of the USA. The size of the investment allows to build up a local management organisation in the near future. Wereldhave has decided to invest at the west coast of the USA in view of the increasing economic activity. The acquisition fits Wereldhave's policy of acquiring newly built, prime property in knowledge based areas.
San Diego is a large harbour city in the south of California, with 1.3 million inhabitants. Large harbour cities at the USA west coast are profiting from the increasing trade with emerging countries in Asia. San Diego is also knowledge center for the biotech industry and offers an attractive climate for companies and employees.
Source: Wereldhave
