Beacon refinances €600m Paris tower

The Boston firm has secured an agreement from German bank, Deutsche Pfandbriefbank, to renew and extend a €600m acquisition and development facility of the ‘Tour First’ tower in La Defense near Paris.

Beacon Capital Partners, the Boston-based private equity real estate firm, has secured the renewal and extension of a €600 million loan provided by Germany’s Deutsche Pfandbriefbank for the redevelopment and acquisition of the Axa Tower in Paris, France.

The original loan was provided by Hypo Real Estate in June 2007, a year before financial problems almost led to the bank to collapsing and before the financial crisis wreaked havoc with global real estate values, development finance, rents and occupancy levels.

In a statement, Harin Thaker, head of international real estate finance at Deutsche Pfandbriefbank, which was created in 2009 out of a merger between Hypo Real Estate Bank and DEPFA Deutsche Pfandbriefbank, said the financing demonstrated its willingness to further support existing customers even in extensive projects.

The equity for the redevelopment and purchase is coming from Beacon’s fifth fund, Beacon Capital Strategic Partners V, which closed on $4 billion (€2.8 billion) in 2007.

The Axa Tower was originally built in 1974 by UAP insurance company. At the time of Beacon’s involvement three years ago, Axa was about to start work on the project with completion due for the end of 2010. However, it is now due to finish in 2011.

Last year, French president Nicolas Sarkozy toured the project, which at 52 floors is reputed to be poised to become the tallest office tower ever built in France second only in height to the Eiffel Tower.