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Union Investment has acquired an office property in central Helsinki comprising around 5,700 sq m of rental space.
The
property at Eteläesplanadi 12 facing the well-known Esplanadi park was
constructed in 1899 and most recently upgraded in 2012. At the time of
acquisition, the occupancy rate is around
80 per cent. The vendor is OP Life Assurance Company. Union Investment
had legal advise from Merilampi Attorneys Ltd. The vendor was advised by
Catella Finland.
The
purchase price is in the region of EUR 50 million and the acquisition
will be added to the holdings of the institutional open-ended real
estate fund UniInstitutional European
Real Estate as part of its ongoing core strategy for the Nordic
markets. In early July, the fund announced the acquisition of an 11,500
sq m office property in central Stockholm. At the end of 2018, it had
sold three office buildings and a logistics property
in Greater Helsinki which no longer fitted the fund’s strategy.
“This
office property facing Esplanadi park represents a rare opportunity to
invest in the heart of Helsinki’s central business district. We believe
that the multi-tenant situation
of the property and the ongoing dynamic rental growth in the city’s
core locations will make it possible to steadily increase the building’s
earning power through active asset management. At the same time we will
continue to monitor the Nordic markets closely
for further acquisitions,” said Martin Schellein, head of Investment
Management Europe at Union Investment Real Estate GmbH.
The
five-storey building offers approximately 3,900 sq m of office space
and around 900 sq m dedicated to retail use and storage. The three major
tenants, who together occupy
some 60 per cent of the rental space, are a law firm, the Finnish
Ministry of Justice and software company Vainu. Helsinki’s main railway
station is approximately 700 metres from the building and the city’s
main pedestrian zone is within walking distance.
Following
the acquisition of this office property near Esplanadi park, Union
Investment now holds five office properties and one development project
in Helsinki worth around
EUR 500 million. The Hamburg-based real estate investment manager
recently acquired Urban Environment House at the development stage for
the UniImmo: Europa fund. Completion of the approximately 27,500 sq m
office property, which is fully pre-let to the City
of Helsinki, is scheduled for summer 2020.
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