Fidelity International's Fidelity Eurozone Select Real Estate Fund has completed its first deal in the Luxembourg market, acquiring a €100 mln modern office building from Atoz Tax Advisers.
Structured as a sale and leaseback deal, the main tenant, Atoz, which represents over 80% of the rental income, will continue to occupy the building. The other three institutional-grade tenants bring the property to full occupancy.
'The acquisition marks a significant drawdown of client capital after our successful €300 mln capital raising event last year, meaning just €85 mln remains to be invested,' said Aymeric de Sérésin, portfolio manager at Fidelity International.
The asset was completed in 2000 and was recently refurbished. It is located close to Luxemburg International Airport.
Fidelity said it had targeted Luxembourg as it seeks to grow in a highly liquid micro-location that is experiencing strong growth.
'Luxembourg is a market where we wish to increase our exposure, not only within the office sector but also within the retail sector,' added De Sérésin.
The Fidelity Eurozone Select Real Estate Fund is aimed exclusively at institutional investors and invests solely in core Eurozone markets.