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Essential IR Insights Newsletter - February 2023

Fairfax makes bid for Grivalia; Google's London HQ gets thumbs up from council

* Grivalia Properties REIC has a suitor in the form of Fairfax Financial Holdings Ltd., with the latter having submitted a cash tender bid of €8.80 per share for the former's minority shares. If the acquisition goes through, Fairfax and its affiliates will own total voting rights in Grivalia amounting to at least 90%.

* Google finally clinched the go-ahead from the Camden Council for its £1 billion headquarters located at London's King's Cross district, a plan that was delayed after a 2013 proposal was first put together. Lendlease Corp. Ltd. will construct the headquarters for the internet stalwart after signing a development contract reportedly worth approximately £350 million.

The 11-story building will provide over 1 million square feet of space, with the Google office taking up 650,000 square feet.


* NewRiver REIT secured £165 million and £50 million term loans, as well as a £215 million revolving credit facility, which will collectively replace £414 million of its secured debt facilities.

* Civitas Social Housing PLC wrapped up its £22.9 million purchase of a regulated social housing portfolio, which contains 21 freehold assets in the southwest of England, according to a news release.

* The U.K. property market looks set to receive some bad news as home prices weakened to bring about the worst-performing July in a half-decade, with prices settling at an average £298,906, down 0.2% month over month, Bloomberg News reported, citing a report by Acadata and LSL Property Services Plc.

The lackluster performance is expected to extend through to the end of 2017, tracking the region's June 8 election results.

* Also not seeing much upside are property transactions linked to private equity firms, which have declined in the region post-Brexit, according to Property Investor Europe. Private equity real estate deal volumes in the U.K. tumbled by a third within the 12-month period after the June 2016 vote to leave the EU, while such transaction volumes gained 31% in Europe in the same span of time.

* Manchester is chasing up to London in the buy-to-let sector, following a series of changes to tax and regulatory policies that have discouraged landlords investment in the British capital, London's Financial Times reported.

* The Newham borough in east London revealed that up to 13,000 landlords under its jurisdiction had not submitted their rental income for tax purposes, which could result in an estimated loss in tax revenue of almost £200 million for HM Revenue & Customs. The Guardian reported that the landlords represented nearly 50% of the borough's total number of landlords.

* A breakthrough has arrived in the British government's quest for cladding improvement as a first cladding system passed a new round of strict fire safety tests, prompted by the fatal Grenfell fire in June, Construction Enquirer reported.

The aluminium composite panel cladding system is the first of four systems reviewed by the government that was found to be in compliance with official building regulations, the report noted.

* Meanwhile, the U.K.'s Local Government Association, or LGA, said private landlords of buildings containing cladding and insulation that had not passed fire safety tests are not acting at a satisfactorily fast pace to ensure their towers are safe, Property Week reported.

LGA also stated that some landlords were "slow" to notify affected residents about the buildings that have failed fire safety tests.


* PATRIZIA Immobilien AG shed a 65,000-square-meter Munich scheme to Rock Capital for an unknown price, with the buyer poised to develop the plot for residential properties, according to a PIE report.

The Hofmann Höfe development formerly housed Siemens and was being worked on by PATRIZIA in a project planned to yield 1,000 apartments, shops, restaurants and other amenities, a task which the buyer will continue.

* Developer TAS is going to launch a residential development on a 15,500-square-meter site it purchased in Oranienburg. The project, which will include 263 housing units providing 21,300 square meters of space, is slated for a 2020 completion, PIE reported.

* Fair Value REIT-AG affirmed its guidance for its funds from operations, or FFO, before noncontrolling interests for 2017 at within the €9.6 million and €10.2 million range. It also expects a per-share FFO after noncontrolling interests of between 43 cents and 46 cents.

Southern Europe

* AEW procured a high street retail building at 45 Calle de Fuencarral in Madrid for Europe City Retail Fund for approximately €50 million, Europe Real Estate reported. The asset, which is the fund's second foray into Spain, spans 2,436 square meters of retail space and is fully leased to Decathlon.

* Eurocastle Investment Ltd., together with Fortress affiliates, purchased an Italian portfolio of performing and subperforming loans valued at about €234 million. Property Magazine International reported that Eurocastle anticipated it would pour up to €20 million into the portfolio.

* The Portuguese real estate sector appears to be experiencing a price uptick even as sales are improving at a weaker rate, PropertyWire reported, citing a monthly report from the Royal Institute of Chartered Surveyors and Confidencial Imobiliário. Property prices are expected to increase a little more than 3% over the next 12 months, while an average yearly firming of 5% is on the cards for the next five years, according to the report.


* Unibail-Rodamco SE will set up a share buyback program for up to €750 million worth of shares, with the repurchase program to run up until Oct. 10.


* TK Development A/S has plans to enlarge its board by two more directors, with a compulsory requirement for one to be female, taking the current lineup of four members to six no later than its annual general meeting to be held in the spring of 2018.


* The Indluplace Properties Ltd. board gave the green light for a cash dividend of 24.72 South African cents per share for the second quarter, with shareholders on record as at Sept. 1 to receive the payout Sept. 4.

Other Real Estate news

* It might not be all gloom and doom in the U.K. property market after all, with the region taking top spot for Europe's biggest commercial property investment market in 2017's second quarter, knocking Germany from pole position, PropertyEU reported, citing data from Real Capital Analytics.

* The U.K., Germany and the U.S. emerged as the top choices for Asian property investors looking to inject capital into cross-border deals, respectively receiving US$6 billion, US$2 billion and US$10 billion, according to a JLL report.

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The Daily Dose Europe, Real Estate edition, is updated as of 6:30 a.m. London time. Some links require a subscription. Articles and links are correct as of publication time.

Rollen Catorce contributed to this report.