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Real Estate News & Analysis: May Edition


Real I.S. forms €1B RE fund; Deutsche Wohnen adjusts conversion price for bonds

* Real I.S. launched a €1 billion real estate fund that will invest in core and core-plus commercial properties in Germany, Property Investor Europe reported. The Real I.S. Themenfonds Deutschland II fund will be 50% financed by debt and have a 10-12 year investment program, aiming for an average annual payout of 3.5%, according to the report.

* Deutsche Wohnen AG adjusted the conversion price and the conversion ratio for its €800 million bond due July 26, 2024. The conversion price was adjusted to €48.2967 from €48.5775, while the conversion ratio was changed to 2,070.53484 shares per bond from 2,058.56621 shares per bond, effective June 5.

UK

* Empiric Student Property Plc expects to log an approximately 2.8% uplift in annual rents for the 2017/18 academic year.

In its trading update ahead of the end of its financial half-year on June 30, the company said the Dec. 31 target for gross annualized rent roll, including commercial, is set to approximately £63.6 million, up from £52.1 million recorded in the same period in 2016.

* According to Fitch, flexible work spaces could trim the value of central London's office market by up to 25% over 10 years. As remote work enjoys "strengthening tailwinds" in London, firms are able to downsize expensive office space and the city's central business district is expected to become more available for uses other than offices.

* BlackRock Real Assets finalized a £100 million debt investment for Wheatley Housing Group's long-term fund raise in Scotland, Property Week reported. The debt financing will partially fund the development of 3,500 new social and mid-market rented homes in Scotland.

* French luxury handbag retailer Maison Moreau made its debut in the U.K. after opening its first store at 21 Bruton St. in Mayfair, London, PW reported. The retailer signed an agreement with Miller Harris to take on an existing lease on the 580-square-foot store, with a 712-square-foot basement, for a passing rent of £137,500 per annum.

* Lloyds Bank Commercial Real Estate loaned £47 million to HB Reavis for the renovation of the Cooper & Southwark office at 61 Southwark St. in London, PIE reported. HB Reavis acquired the nine-story, 7,000-square-meter property from Aberdeen Asset Management in 2016, the report noted.

* Urban&Civic plc announced independent nonexecutive director Bob Dyson's plan to retire from the board at the company's 2018 annual general meeting.

France

* Nexity launched a tender offer for its bonds maturing in December 2018 and a private placement to issue a new series of notes in one or several tranches. The new notes are expected to have an average maturity of seven years, with the issuance expected to take place June 29.

* The newly established F&A Asset Management, which focuses on retail real estate, plans to grow its assets under management to €1 billion within five years, while currently having an investment capacity of €160 million, PIE reported. The company was launched by Maxime Forgeot, who was formerly an investment manager at Schroders and an operating manager at Unibail-Rodamco SE.

* House prices in Paris returned to June 2011 record levels after rising 7.2% year over year in May and 4.6% in the first five months of 2017, PIE reported, citing MeilleursAgents. Homes in the French capital are now selling at an average of €8,709 per square meter, the report added.

Germany, Hungary and Czech Republic

* Allianz Real Estate, in a forward deal, purchased the EightFloors Berlin office complex from Patron Capital Partners and Suprema for €175 million, PIE reported. The deal for the 40,000-square-meter office asset will close following the completion of refurbishment in 2018.

* Cromwell Property Group and Partners Group AG have jointly sold a portfolio of 11 light industrial assets across central and eastern Europe for an undisclosed amount. The 209,832-square-meter portfolio of seven assets in Hungary and four in the Czech Republic was sold to M7 Real Estate on behalf of its fund M7 CEREF I.

Southern Europe

* Lar España Real Estate SOCIMI SA secured a €34.8 million loan to fund real estate acquisitions over the next months. The company's total debt has reached €591.3 million following the loan agreement, with its net loan-to-value ratio at 40% of its gross asset value.

* Tikehau Capital purchased the Area12 shopping center in Turin, Italy, from the San Sisto consortium for approximately €65 million, PIE reported. The 30,000-square-meter asset, which sits inside the Juventus Stadium, offers about 60 retail stores.

Middle East

* DAMAC Properties launched the Aurum Villas project in Dubai's AKOYA Oxygen community, with villas priced at 1.6 million United Arab Emirates dirhams. The villas will go on sale June 7.

Other Real Estate News

* INTERNOS Global Investors attracted €133 million worth of equity from seven German institutional investors, at the first close of its second hotel real estate fund. Hotel Real Estate Fund II has a strategy concentrated on city center business hotels across Europe.

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Data Dispatch Europe: Stricter mortgage rules set to further curb Swedish mortgage lending: Potentially stricter amortization rules on home loans could curb mortgage lending growth at Sweden's major banks, analysts say.

Data Dispatch: 23 REITs announce new ATM programs through June 1: A total of 30 U.S. real estate investment trusts raised $860.9 million through at-the-market offerings in the first quarter, a decrease of 41.9% from the fourth quarter of 2016.

Data Dispatch: NAV monitor: US REITs trading at 3.7% median discount to NAV as of June 2: Nine out of the top 10 companies trading at the greatest discounts to net asset value were from the retail sector.

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.

Anusha Iyer contributed to this report.