European private equity group Henderson Park has joined forces with Swiss Life Asset Managers to acquire the Kustermann Park office complex in Munich in a deal valued at a total of €400 mln.
Henderson Park and Swiss Life are buying the 74,000 m2 asset from funds managed by BlackRock.
The asset consists of two buildings located directly adjacent to Munich’s Werksviertel quarter, which is currently undergoing a major regeneration across a total area of 390,000 m2. Henderson Park, which sourced and structured the deal, is acquiring Rockwell Haus, a 42,000 m2 building which is fully leased to a range of tenants including the City of Munich, TDK and Regus.
Two of the main tenants are due to vacate the property at the end of the year, offering Henderson Park the opportunity to invest further capex into the building and subsequently bring a total of 12,000 m2 of refurbished office space back to market in 2020.
Swiss Life AM is acquiring Brinell Haus, a 32,000 m2 fully-leased property with a weighted average lease term of 14 years. The City of Munich, which will occupy 40% of the asset, has signed a 20-year lease for the building following a refurbishment to accommodate increased tenant demand.
'The dual acquisition process was structured by Henderson Park to provide the seller with a single, simultaneous disposal solution for both assets by bringing together two capital partners with differing risk profiles,' the buyer said in a statement.
Nick Weber, founding partner of Henderson Park, said: 'Munich is an affluent city and one of Europe’s top performing office markets, being consistently characterised by high demand and low vacancy rates, and this acquisition gives us a great entry point into this important market.'
Maureen Mahr von Staszewski, senior pan-European fund manager at Swiss Life Asset Managers, added: 'Given low vacancy rates, it can be difficult for investors to gain exposure to the Munich office market. Therefore, we are delighted to have had the opportunity to work with Henderson Park on this deal. This transaction supports our strategy to invest in core European locations where we believe we can offer investors attractive long-term returns in the current low interest rate environment.'
BlackRock bought the asset in 2017 from New York-listed Ares Management Fund for an undisclosed amount. It was previously owned by the insolvent Australian Group Babcock & Brown, which went into liquidation in 2009.