03 Aug 2017 - Europa Capital sells its Budapest office portfolio

Europa Capital has concluded the sale of the Kalvin Portfolio, Budapest. The Kalvin Portfolio comprises two City Centre office buildings in Budapest with a total floor area of approximately 26,000 sq. metres.

KGAL, a leading independent European asset and investment manager, acquired the Kalvin Square and CityZen assets on behalf of institutional investors. The combined price for the portfolio is approximately €60.0 million. The property management will be carried out by KGAL´s local partner ConvergenCE.

James Pennington, Director of Asset Management for Europa Capital, said:

“The portfolio was acquired out of a distressed position, when the buildings had a combined vacancy of around 45% and were capital-starved.  We implemented an intensive active asset management strategy that involved a significant refurbishment and rebranding of the CityZen building, extended leases with existing tenants and marketed and leased the vacant space. A BREEAM ‘very good’ environmental rating was secured on both CityZen and Kalvin Square.  Over the two-year period of Europa Capital’s ownership, the contracted rental income has increased from €1.4 million to €4.0 million, and the weighted average lease term has significantly increased from 1.5 years to 4.6 years.”

ConvergenCE Hungary provided investment acquisition, local asset, property and project management services to Europa Capital.

Robert Martin, Founding Partner and Europa Capital’s Head of Central Europe commented:

“Two years ago, we identified the Budapest office market as tactically compelling. With improving macroeconomic indicators combined with a low development pipeline and a shortage of high quality space, we believed occupational and capital market dynamics would improve.  We have now executed our strategy and so delivered strong returns to our investors. We further believe in positive development of the Budapest office market.”

André Zücker, Managing Director KGAL Investment Management and responsible for Real Estate, points out: “We expanded our European growth strategy into Budapest for a very good reason. We see a huge upside potential for this part of the European office market.”

For further information, please contact: Gordon Simpson/Elizabeth King, Finsbury: + 44 20 7251 3801

About Europa Capital:

Europa Capital is an established real estate fund management group operating across Europe adding value through risk-based acquisition strategies and active asset management on behalf of its investors.

Since 1995, Europa Capital has collectively raised 9 real estate funds and committed to over 105 transactions totalling more than €9.5 billion across 19 European countries.

The Europa Funds benefit from Europa Capital’s established network of partners across Europe who co-invest in acquisitions made by the Europa Funds. These country and joint venture partner relationships in some cases extend back more than 20 years.

Europa Capital is a member of Rockefeller Group International, Inc. (“RGI”). RGI is a strategic investor alongside Management. Europa Capital Partners LLP and Europa Capital LLP are authorised and regulated by the Financial Conduct Authority.

Further information can be found at www.europacapital.com

About KGAL:

KGAL GmbH & Co. KG, a German based asset and investment manager, with registered offices in Grünwald near Munich (Germany) has been initiating and managing long-term real capital investments with sustainable and stable yields since 1968. The company's portfolio of services comprises the design and management of funds for institutional investors. The quality of KGAL products in the main asset categories of real estate, aviation and infrastructure is based on the experience of its in-house experts.

As of December 31st 2015, the KGAL Group manages an investment volume of EUR 21.7 billion. KGAL currently manages capital for 99,000 investors (incl. multiple subscriptions) with equity investments in a total of 116 active limited partnership funds. Investors have entrusted EUR 7.3 billion in equity capital to KGAL for these funds. The KGAL Group has 337 employees (as of 31.12.2015).

About ConvergenCE:

ConvergenCE is primarily an independent real estate investment & development company which also provides asset management, property management and project management services in Central Europe. Since its establishment, the company has developed commercial projects with a total investment volume of over €200 million and assets under management with a value of €150 million. ConvergenCE has also project monitored and managed projects with a total value in excess of €200 million on behalf of third party owners, occupiers and investors.