Norway's wealth fund buys prime Paris asset for €613m

Norges Bank Investment Management has exchanged contracts to buy 79 Avenue des Champs-Élysées in Paris from Groupama for €613 mln, a price that is believed to equate to a yield in the region of 2%-3%.

The deal means Norway’s sovereign wealth fund has committed more than €1 bn in the last month to real estate in the French capital.

NBIM will acquire the mixed-use, art deco asset later next year, after French insurance group Groupama completes a refurbishment.

Groupama announced last month that Nike would take the building’s 7,200 m2 of retail space as its third ‘House of Innovation’ digital store, following recent openings of the concept in Shanghai and New York. CBRE is advising Nike on the acquisitions. The Paris renovation also includes 3,100 m2 of office space.

EuroProperty revealed last month that NBIM had agreed to buy 54-56 rue la Boétie in Paris’s 8th Arrondissement, for €415.5 mln. The 20,400 m2 rue la Boétie office was sold by South Korean asset manager IGIS, acting on behalf of a Korean consortium led by Hanwha and Kyobo Life Insurance and that deal is expected to close before the end of the year.

Paris’s office investment transactions market has had a very strong year, driven by its best take-up since 2011 during the first nine months of 2018, according to CBRE. Take-up was nearly 1.9 million m2 , 13% higher than the 10-year average. In Q3 2018, NBIM paid £321.3 mln (€357.8 mln) for Amazon’s 226,000 sq ft (20,996 m2) London office, at 60 Holborn Viaduct.

This article first appeared in EuroProperty, PropertyEU's weekly sister publication


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