Valesco, AIP bring first South Korean capital into Slovakia with €120m Twin City Tower purchase

Valesco and AIP Asset Management have paid €120 mln for an office building in the capital city Bratislava on behalf of unnamed Korean investors.

The fanning out of Korean capital across Europe continues with the first deal having been struck in Slovakia.

AIP Asset Management together with The Valesco Group has struck a deal to buy an asset in Bratislava for €120 mln at a yield of 5.75% from developer HB Reavis. The investment has been made on behalf of unnamed Korean investors.

The new-build asset is named Twin City Tower and is located in Bratislava’s central business district. It comprises 34,742 m2 across 23 floors, with online retailer Amazon the principal tenant on a long-term lease and the building fully let. It comprises 1,360 m2 of retail space, 456 parking spaces and a rooftop garden. Construction was completed in late 2018.

Shiraz Jiwa, founder and CEO of Valesco said: ‘This prime asset coupled with an exceptional principal tenant in Amazon in the growing core of Bratislava offers a unique and compelling investment opportunity.

‘It is rare to find an alignment of macro, micro and real estate fundamentals that will together drive value over our holding period. Furthermore, we are seeing substantial blue-chip corporate migration to the city and an influx of international capital attracted to the investment thesis.

‘Being only a 40 minute drive from Vienna, but with a very different yield profile of almost 300 basis points, this offers the opportunity for investors to benefit from a pricing dislocation play, while the fundamentals underpinning the income are very attractive. It is particularly pleasing to be adding Amazon to our growing portfolio of coveted tenants.’

Seoul-headquartered AIP regularly partners with Valesco for investment ventures in the EU, including acquisitions in the UK totalling €393 mln.

Welcoming the deal, Marian Herman, CEO of seller HB Reavis, said: ‘The Nove Nivy zone in Bratislava is a showcase of our strategy offering necessary scale to deliver not only quality development, but also value-added services and content. Twin City Tower was among the first projects in the area, fully leased months before its opening.

‘Innovative technologies and community building services and events are much appreciated by our tenants, as they are a good talent attraction and retention tool.' 

Capital from South Korea has been fanning out across the continent of Europe recently - with Paris a particular focus of activity. Last week, an unnamed investor from the Asian country purchased the Crystal Park office building in the French capital, Paris, for €691 mln. Last month South Korean investors paid €280 mln for Tour Europe in Paris’s La Défense, from the French arm of international investment manager BlackRock.

Other high-profile towers in the Parisian district involving Korean buyers include Unibail-Rodamco-Westfield’s sale of Tour Majunga to a consortium of institutional buyers for €850 mln, and the sale of Tour Eqho to a Korean buyer for around €750 mln. Elsewhere, the Korean JV Vestas Nvesetment management and Hana Financial paid €400 mln for the CBX building.

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