EQT makes first real estate purchase via debut fund

The real estate arm of Nordic private equity giant EQT has teamed up with French asset manager STAM Europe to acquire a €33m asset in Paris’ central business district. The deal is understood to represents EQT’s first purchase through its debut European fund.

EQT Real Estate, the London-based real estate arm of Nordic private equity giant EQT, has acquired a €33 million office asset in Paris’ central business district – thought to be the firm’s first real estate acquisition made for its debut opportunistic property fund, also called EQT Real Estate. The vehicle was raised for investments in European opportunistic investments.

The property is a 61,000 square foot office asset in the French capital’s 16th Arrondissement and lies on Rue Lauriston in the heart of the city’s business center, in close proximity to the Arc de Triomphe.

EQT teamed up in a joint venture with its local partner, Paris-based asset manager STAM Europe.

The seller was not disclosed but it is understood to be a private investor.

A spokesman for EQT said the firm is targeting properties in European gateway cities benefiting from tight supply and solid occupier demand.

“With the investment in Paris CBD, EQT looks forward to creating value through optimizing the current site and developing a benchmark office property, offering quality, modern space to office tenants,” added Robert Rackind (pictured) and Edouard Fernandez, partners and real estate co-heads at EQT.

“This will be a great partnership for STAM Europe on Rue Lauriston, as EQT is a firm representing growth and development. Both our groups have substantial experience in high profile value-add projects of this nature,” said Edward Bates, managing director at STAM Europe. “With our local footprint and the EQT real estate team’s pan-European focus, we will be able to transform this asset into a landmark office building,” he added.

Earlier this month, PERE revealed that EQT had raised €200 million in capital commitments for the 2015 fund from a combination of European institutional investors as well as seeding from EQT Real Estate itself. The vehicle has a fundraising target of €500 million. The fund is thought to have a fund life of eight to 10 years and a target IRR in the region of 16 percent to 20 percent.

In addition to this opening transaction, further deals in Paris and Cologne are also thought to be in the pipeline.

The capital raising and deal represent the first market activity for the giant private equity firm which launched its real estate business last year. Over the last year, the firm has been growing out its team, adding six executives to bring its real estate team up to 13.

Ashurst and Thierry Vachon advised EQT and STAM Europe. Financing was provided by Aareal Bank.

Source : PERE

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