Dream Global has reached a binding agreement with the vendors, TPG and Patron Capital Partners, to buy Merin at a 'going in capitalisation rate of 8.0%'.

The Canadian REIT is financing the acquisition with the proceeds of a recent €300 mln public offering and a planned €375 mln offering of unsecured notes in Europe.

Merin owns and manages 101 office assets that provide 715,000 m2 of gross leasable area and have a gross value of €502 mln.

The platform, run by a 40-strong team and headed by CEO Bas van Holten, also owns 34 industrial assets. This portion of the portfolio comprises almost 270,000 m2 of leasable space, valued at €120 mln.

Dream Global was founded in 2011 to invest exclusively outside of Canada. Over the last six years, the company focused on Germany, before making more recent forays into neighbouring markets.

Until the Merin deal, the company's portfolio consisted of 1.3 million m2 GLA of office, industrial and mixed-use properties across Germany, Austria and Belgium. 

Jane Gavan, CEO of Dream Global REIT: 'We are entering a market that has good office fundamentals and growth potential, and we will have a sizeable Dutch real estate management team that has a successful track record of increasing occupancy and achieving growth.

'We believe that this transaction is a meaningful milestone for Dream Global REIT on the path to becoming the premier European REIT for capital market investors.'

CMBS legacy
Merin was acquired by TPG Real Estate, TPG Sixth Street Partners (TSSP) and Patron in 2012, in the first restructuring of a European commercial mortgage-backed securitisation at legal final maturity.

A new management team led by van Holten repositioned the portfolio through a combination of asset management, refurbishment and over 50 acquisitions and disposals. 

The sale to Dream Global represents the third significant transaction for Merin this year following a significant add-on acquisition and a €440 mln refinancing.

Anand Tejani, partner at TPG Real Estate, commented: 'Having acquired Merin through an innovative and complex transaction in 2012, we are delighted with the successful transformation of the company in collaboration with management and our partners at Patron.'