CEE investor CPI has inked another office deal in Warsaw with the purchase of the Warsaw Financial Center (WFC) from a joint venture between Curzon Capital Partners III (CCP III), a core-plus real estate fund advised by Tristan Capital Partners and Allianz Real Estate, acting on behalf of several Allianz group companies.
Financial details were not disclosed.
Standing at more than 144 metres tall with 36 floors, Warsaw Financial Center is located in the heart of Warsaw’s central business district, and comprises almost 50,000 m2 of lettable area, 93% of which is office space, with the remainder consisting of retail and storage. The property also offers 333 internal parking spaces spread across six above-ground floors in the building.
Matt Lunt, executive director, portfolio and asset management at Tristan Capital Partners, said: 'When we first acquired WFC, we undertook major refurbishments to the entrance and ground floor lobby areas and have worked steadily to increase occupancy to 99%, with tenants including leading Polish and international corporations such as Google, CMS Cameron McKenna, Bloomberg, the World Bank and Kompania Piwowarska, part of the Asahi group of Japan.'
CCP III was advised by JLL, CMS, EY and CMT.
CPI is acquiring a total of eight city-centre office properties in Warsaw as part of plans to expand its footprint in the Polish capital and take advantage of strong market conditions.
‘As the leading income-generating real estate company in CEE, expanding on our existing footprint in the attractive Warsaw office market is a natural strategic step for the Group,' Nemecek recently told PropertyEU. 'Office market conditions in Warsaw are robust, fueled by strong economic growth and excess demand for space from international and local tenants, while at the same time offering attractive yields and long-term value opportunities.’
In addition to WFC, the company, which announced in October that it expected to buy some €800 mln of high-quality offices in the city, has already either signed or closed the purchase of four properties (Green Corner A, Equator II, Eurocentrum and Equator IV) for a total of slightly more than €400 mln.
‘We expect to sign the remainder of the assets between now and the end of Q1 2020,’ CEO Nemecek added.
The assets all benefit from strong occupancy, high quality tenants and excellent green credentials, with values ranging between €30 - €200+ mln.
CPI is able to ‘comfortably’ fund the acquisition pipeline from existing balance sheet liquidity, according to Nemecek. 'Cash and cash equivalents stood at €850 mln at the end of September 2019, further bolstered by a €750 mln green bond issue in October, providing the firm with significant dry powder for acquisitions.'
At the same time, CPI is committed to maintaining a strong financial profile while improving the business profile 'through enhanced scale, diversification and income generation'.
The group had total assets of €9.5 bn at the end of Sept 2019, up from €8.3 bn at year-end 2018. Its property portfolio increased by €335 mln to €7.9 bn over the past three quarters, reporting a 5% growth in gross rental income and a 3.3% increase on a like-for-like basis.
CPI boasts a low loan to value ratio of 32.9%, with unencumbered assets representing 70% of its portfolio.