The National Bank of Greece has sold a 66%-stake in NBG Pangaea real estate investment company for €653m to Invel Real Estate Partners, reflecting a near to par value for the assets, with a €420m vendor finance package in a longer than 10-year senior loan.
York Capital Management, the global investment management firm, has acquired €125m while the balance acquired by a trust representing a Middle Eastern family office and Invel senior management.
Invel, which first announced the deal almost six weeks ago, has structured the deal with The National Bank of Greece paying a near par value for the carrying value of the real estate in exchange for long term financing which is vastly superior than the bank markets would support.
CoStar News understands that The National Bank of Greece has agreed a €420m senior loan at sub 350 basis points over a term greater than 10 years.
The National Bank of Greece has retained the 34% balance, and with it retains controlling rights in the joint venture with the Invel-assembled consortium to share in the upside of Invel’s business plan, implying a total value of the company’s commercial real estate of €989.4m.
This is Invel’s first completed transaction since Papachristophorou set up the firm in March 2013. Invel seeks to capitalise on real estate investment opportunities throughout major European markets that involve corporate and government restructuring, complex capital structures, and or asset redevelopment and repositioning.
York Capital Management, which is an event-driven investor in distressed and restructuring special situations, is also through to the second round for NAMA’s €373m Project Holly, a non-performing pool of Irish development and commercial property loans originally lent to with Sean Reilly, the Irish property developer and investor.
Pangaea, the largest of the Greek REICs, will soon own (after closure of certain planned acquisitions during the first quarter of 2014) a portfolio of 269 commercial real estate properties, comprising a gross leasable area of nearly 700,000 sq m, and valued at over €1.0bn.
The existing portfolio encompasses nearly all of the main office buildings of NBG and its bank branches, spread across various cities in Greece with concentrations in Greece’s main regions of Attica and Thessaloniki, while the planned acquisitions mentioned above include Greek assets leased to the Hellenic State.
Pangaea retains its own management team and employees, with significant experience in the Greek real estate market. Invel will work closely with Pangaea to assist it in achieving its business plan objectives with regards to both origination and execution of acquisitions, focused on high-quality and well-tenanted commercial properties in good locations.
Invel’s founder and managing Partner, Chris Papachristophorou, said in a statement this morning: “Pangaea offers significant potential to become one of the leading real estate investment companies in Southern Europe and the Balkans and we aim to grow to over €2bn of assets over the next five years.
“We are delighted to welcome York Capital as co-investors. York Capital’s investment demonstrates its trust in Invel’s team and our investment approach and in particular with respect to the Pangaea transaction.”
William Vrattos, head of global credit at York Capital Management, also said in the statement: “York is privileged to partner with Invel and the National Bank of Greece on this important transaction. This investment demonstrates our continued confidence in the recovery and strengthening of the Greek economy and banking sector.”
The transaction has received regulatory approval from the Hellenic Financial Stability Fund, the Hellenic Capital Markets Commission, and the Directorate-General for Competition of the European Commission.