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Brexit hurts spending on central London offices; Benson Elliot JV buys 3 hotels

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Brexit hurts spending on central London offices; Benson Elliot JV buys 3 hotels

* According to property firm Avison Young, investments in central London offices declined by nearly £3 billion in the run-up to Brexit, London Evening Standard reported. A total of £2.2 billion of purchases were signed in the third quarter, down from £5.1 billion in the same period in 2018.

Investors are concerned about tenant demand for offices after the U.K. leaves the EU, with some potential buyers waiting to see if house prices improve before selling, the publication said.

Separately, Knight Frank partner Dan Gaunt said there is a good occupier demand for offices in London, with lettings signed for during the third quarter set to equal or better the previous quarter's total of 1.6 million square feet, the paper said.

* Benson Elliot Real Estate Partners V and Schroder Real Estate Hotels acquired three themed hotels in Disneyland Paris in two separate transactions for roughly €240 million. The investment on the 1,183-room portfolio is structured as a 50/50 joint venture between Benson Elliot and a consortium of private investors advised by SREH.

Dream Castle and Magic Circus were purchased from Austrian real estate developers Warimpex and UBM, while Explorers was bought from a joint venture managed by SREH.

* As per a study by real estate services firm Sherry Fitzgerald, Irish property experienced flat price growth in the first nine months of 2019, with the value of an established house rising by 0.3% during the period, The Times (UK) reported.

The average value of established homes fell by 0.2% in the third quarter of the year. Prices inched up slightly in the nine-month period, compared with a 3.7% growth in the 2018 comparable period, the publication said.

* European financial hubs topped UBS Group AG's list of cities most prone to a property bubble on the back of low rates. According to The UBS Global Real Estate Bubble Index 2019, Munich is the most overvalued housing market globally. Amsterdam, Toronto and Hong Kong also exhibit the greatest bubble risk, while Frankfurt and Paris are entering the risk zone for the first time, according to the study.

* The U.K.'s Financial Conduct Authority is implementing new rules to prevent the shutdown of open-ended real estate funds, IPE Real Assets reported. The regulations include requiring open-ended funds that invest in illiquid assets to suspend dealing in case of "material uncertainty" regarding the value of more than 20% of assets.

UK and Ireland

* Hines, on behalf of its nontraded real estate investment trust unit Hines Global Income Trust, acquired a student accommodation asset in Glasgow, for £72 million, IPE Real Assets reported.

Bricks Capital sold the fully let 607-bed operational asset on Kelvinhaugh Street. It will be managed by Hines' student accommodation platform Aparto.

The deal follows the REIT's acquisitions of Queens Court in Reading, U.K., and Montrose in Dublin, Ireland.

* Hammerson PLC agreed to sell Abbotsinch Retail Park in Paisley, Scotland, to Ashby Capital for £67 million, reflecting a 7.8% net initial yield. The consideration is 3% below book value as at June 30. The fully leased property comprises 24,600 square meters of floor space. Tenants include B&Q, Dunelm, Tapi and Natuzzi.

* Tritax Eurobox PLC agreed to increase its existing €300 million unsecured revolving credit facility by €125 million, with Bank of China and Banco Sabadell agreeing to provide new commitments of €100 million and €25 million, respectively, alongside existing lenders Bank of America Merrill Lynch, HSBC and BNP Paribas.

The facility has an opening margin of 1.55% and a maturity date of October 2023, which can be extended by two additional years, subject to lender support. The increase is on the same terms as the existing facility, of which €235.5 million is drawn.

* Grainger PLC will forward fund developer Panacea Property Development's roughly £42 million build-to-rent scheme in Sheffield, U.K., which will contain 284 homes. Construction on the Well Meadow site is expected to commence in early 2020, with practical completion anticipated to take place in early 2022.

* U.K.-based industrial landlord SEGRO PLC is adding five units comprising 108,000 square feet at its SEGRO Park Rainham property in East London. The speculative development, which makes up the park's second phase, ranges in size between 11,000 square feet and 36,000 square feet. The facility will incorporate sustainability features such as a living feature green wall inside a reception area, translucent wall and roof panels in a bid to target carbon neutrality.

France, Germany and Romania

* UBS Asset Management (Italy) acquired a portfolio of luxury retail properties in Paris for €250 million on behalf of real estate fund UBS (I) Diamond Eurozone Offices, Property Magazine International reported. The buildings are in 12, 14 and 48 of Avenue Montaigne in the eighth arrondissement.

* Real estate asset manager AEW acquired an office building in Weisbaden, Germany, from NORSK Deutschland AG and IFM Immobilien AG for an undisclosed sum, Property Funds World reported.

The 4,700-square-meter Wiesbadener Palais was bought on behalf of a German pension fund. The Hessian Ministry for Digital Strategy and Development and HRA Pharma Deutschland are the anchor tenants of the five-story building.

* An analysis from Christie & Co. showed that Bucharest, Romania, saw growth in both supply and demand in its hotel market, according to Property Magazine International. The capital city saw yearly increases of 7% in arrivals and 6.5% in overnights in the past five years, with international guests accounting for roughly 60% of hotel demand.

Meanwhile, hotel supply has risen 1.7% annually since 2014 to a total of 19,700 beds in 125 hotels. Over 1,200 rooms are expected to be added by 2021, the publication added.

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