Floreat completes sale of landmark Dusseldorf building
Floreat has completed the sale of a multi-let office in the Dusseldorf North sub-market for a price over EUR60 million, delivering a 50 per cent-plus IRR.
Initially bought in May 2016 for EUR31.8m, 7-9 Parsevalstrasse – located 1km from Dusseldorf airport – has been sold to Tristan Capital Partners, the London-based real estate investment management boutique.
Floreat’s real estate team repositioned the building, which had been under-managed with significant vacancy. The repositioning included a modernisation programme, which saw it rebranded to Parseval Square, and a re-leasing strategy for the 34,000 sq m site. This helped to both attract new tenants and achieve renewals.
The success of this programme meant the team was able to sell the building three years ahead of its original business plan.
The site’s location has benefitted from increased tenant demand, with primary drivers being the excellent transportation links and the relatively affordable rental levels when compared to other areas of both the city and country.
It is the fourth transaction for Floreat this year, following the purchase of the Shipping Building, part of the Old Vinyl Factory regeneration, in West London, and further acquisitions of offices in Bristol and Cardiff.
Greg Davison, Asset Manager in Floreat’s Real Estate team, says: “This sale demonstrates our ability to turn around significantly underperforming assets in short timeframes, delivering returns which greatly exceed market norms. A targeted CAPEX plan and re-branding exercise were implemented to help accelerate the leasing pipeline. This strategy proved to be successful, with five new tenants signing in quick succession, facilitating an early sale.”