Patrizia's acquisition of the giant LBBW housing portfolio in Germany for €1.4 bn in 2012, the biggest property deal in Europe that year, has claimed the top prize in the residential category of PropertyEU's Deal of the Decade Awards and is the overall winner of the competition.
In 2012 Patrizia led a consortium of international institutional investors to acquire LBBW Immobilien and its 21,000 residential units in Germany from Landesbank Baden-Württemberg for €1.4 bn. Allen & Overy advised the buyer, while Leonardo & Co and Hengeler Müller acted for the seller.
Jury comment
The judges said the transaction, the largest property deal in Europe in 2012, was the first-ever club deal of German and international institutional investors which aligned the regulatory, tax and governance requirements of different parties and countries. Patrizia won a very competitive bidding process and then implemented an ambitious business plan which led to improved operations, rental growth and a reduction in financing costs.
‘A very effective deal given its size and proven return to investors of 25%,’ the jury said. It described the transaction as a ‘very historical deal in a very strong market which pushed the existing boundaries’. As a result, Patrizia was able to sell the portfolio to listed company Vonovia in 2015 for €1.9 bn.
In its motivation for submitting the LBBW deal, Patrizia said the positive outcome was the result of ‘bringing in the right management team, strongly focused on improving the properties and operations and maximising the exit value at the peak of the market through a sale to Vonovia.’
1ST RUNNER-UP
In 2014 Bouwfonds acquired Eindhoven Lighting, a portfolio of student housing assets in the Netherlands, from City Pads for €80 mln. The jury said it was one of the first large-scale conversions from offices into student homes in the Netherlands, allowing investors to make quick returns because of the short building period.
The buyers were successful in seeing the demand from both foreign and domestic tenants for fully furnished and serviced small apartments with internet access. The buildings were fully let before opening and on completion all tenants moved in.
2ND RUNNER-UP
In 2015 Canada’s Pension Plan Investment Board (CPPIB) acquired the Liberty Living platform from the Brandeaux Student Accommodation Fund for €1.5 bn.
Liberty Living is one of the UK's largest student accommodation providers with over 40 residences located in 17 of the largest university towns and cities across the UK including London, Manchester and Leeds. The judges said the transaction was a milestone for the sector, as such a high-profile acquisition by a large institutional long-term investor marked the transition of student housing from niche sector to sustainable asset class.
