German property firm Patrizia has acquired the Aire office building in Luxembourg City on behalf of its institutional clients for a price thought to be in the region of €70-75 mln.
The acquisition increases the number of properties Patrizia manages in Luxembourg to 13, comprising total space of around 87,000 m2, with a total value of €800 mln.
Located on Route d’Esch 80 in the western part of Luxembourg’s central business district, the 5,600 m2 building is fully let to Brown Brothers Harriman, one of the largest private banks in the US, with a weighted average unexpired lease term of 10.5 years. The property, which was completed in 2015, has a BREEAM ‘Very Good’ rating and also includes 362 m2 of storage space, 43 parking spaces and a garden area.
The area where the asset is located is currently undergoing extensive redevelopment and a new tram line, now free for all users in Luxembourg city, is due to be completed by 2021.
PropertyEU understands that negotiations to acquire the asset started before the crisis with the deal closing now. It is the third transaction completed by Patrizia during the coronavirus crisis, following a €51 mln acquisition in Amsterdam and a residential portfolio sale in the Netherlands for €375 mln.
‘We are pleased to have completed discussions to buy this prime asset on behalf of our clients during this current time of uncertainty for the world economy, highlighting our ability to execute transactions during this period,’ said Sheelam Chadha, who is in charge of transactions for Patrizia in Belgium and Luxembourg. ‘This asset offers highly stable and secure rental income backed by strong collateral which is even more important in today’s market environment. We are confident in the ongoing resilience of the Luxembourg market, which remains a desirable investment location with robust demand for office space and limited vacancy due to its position as a worldwide financial centre and an established hub for major multinational companies in Europe.’