Hines acquires Warsaw office asset
Hines has agreed to purchase of Wola Center, a 34,000-square-metre office asset in Warsaw, on behalf of the Hines European Value Fund (HEVF 1).
The asset has been acquired from Polish property company Develia, listed on the Warsaw Stock Exchange, for an undisclosed price.
The acquisition represents the eighth portfolio investment for HEVF 1, the flagship core plus/value-add fund, for which Hines raised EUR721 million of equity commitments in closings from July 2017 to August 2018, exceeding the original fund target size by over 40 per cent. The fund’s portfolio of investments includes multi-sector assets in Germany, the UK, Denmark, Spain and Italy.
Wola Center comprises four interlinked buildings around a central atrium and is located in the heart of the CBD West, the city’s modern business and retail centre. The building was developed in 2013.
The modern, Grade-A office space is currently fully occupied, but will become 70 per cent vacant at the end of 2020 upon the departure of the majority tenant group, providing Hines with the opportunity to refurbish and reposition the space before re-leasing.
Wojciech Rumian for Hines, says: “Wola Center is one of Warsaw’s best-known and most prestigious office schemes, with the quality of space, location and tenant profile making this a landmark acquisition for Hines in this region. CBD West is benefiting from significant public infrastructure investment, and with upgrades Hines will be making to the vacated space, we expect occupier demand will be extensive.”
Paul White, HEVF 1 fund manager, added: “This transaction epitomises the classic Hines approach to real estate. Our local team on the ground sources and executes an off-market transaction to acquire a high-quality complex in a prime CBD location. We believe the asset has clear potential to be a core asset, only given the right finishes and rent roll. The Hines team will execute on the opportunity to add value by upgrading vacated space, moving into rapid lease-up to a new tenant base.
“The pace of our deployment of this first HEVF value-add fund has led us to accelerate the anticipated launch of the follow-on fund. HEVF 2 will closely follow the philosophy of its predecessor, prioritising skilled asset-level value creation in prime locations of Europe’s most institutional city markets.”