Starwood Capital Group, a global private investment firm, has acquired The Park office park in Prague for just under €300m, from two maturing open-ended DEGI funds controlled by Aberdeen Asset Management, financed with a five-year senior loan Deutsche Pfandbriefbank (PBB) and Helaba.
This is the second time Aberdeen has tried to sell The Park, after it was brought to market two years ago with an asking price of around €350m. But the highest offer in August 2011, was from MSREF, which offered around €325m, which was deemed too low a price to sell.
However, with the two DEGI funds which collectively own The Park nearing their maturity, Aberdeen brought the asset to the market once again and eventually accepted a lower price than it could have achieved two years ago.
The sale crystallises a loss for the two DEGI funds which acquired The Park in 2008 for €403m.
MSREF was one of at least three underbidders second time round.
Jeff Dishner, senior managing director at Starwood Capital Group, said: “We are pleased to be acquiring such a premier, well-performing property in one of the most vibrant economic regions in Europe.
“This transaction fits perfectly in line with our previously announced goal of increasing single asset transactions with solid cash-on-cash returns at a discount to replacement costs as we look to grow our European presence.
“The Park is a trophy asset with a world-class management team and high credit quality tenants, and we look forward to building on its strong track record of success going forward.”
The Park is considered the most successful suburban office Park in Central and Eastern Europe. Located next to the D1 highway in Prague’s Chodov district and next to one of the major metro lines, it is a master planned campus consisting of twelve buildings comprising 116,000 sqm GLA.
The Park was developed by AIG/Lincoln between 2003 and 2009. It is more than 99% leased to multinational companies like DHL, IBM, SONY, Accenture, Oracle, Dell, Honeywell, and many more.
Charles Balch, head of international clients, UK & CEE at pbb Deutsche Pfandbriefbank, said: “This is one of the biggest transactions in the Czech Republic for a long time. Prague remains one of the most attractive investment markets in CEE and The Park is clearly a trophy asset.”
Michael Kröger, head of international real estate finance at Helaba, said: “Helaba is very pleased to have been able to support Starwood Capital in its first major investment in the CEE region.”