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CBRE GI grabs Vienna’s IZD Tower for €270m

The Los Angeles-based real estate investment manager purchased the iconic tower on behalf of Korean clients. 

CBRE Global Investors (GI) has acquired the 39-story IZD Tower in the Austrian capital for a figure believed to be more than €270 million.

The firm said it bought the tower on behalf of Korean clients through one of its separate accounts. The seller was a German fund managed by Austrian investment manager SIGNA.

The tower, which has an adjacent six-story building, has a 94 percent occupancy rate with an average lease length of 10 years. Tenants include Ernst & Young, Estee Lauder Cosmetics and Santander Bank.

Located in Vienna’s Donau City office district, the IZD Tower has 699,000 square feet of space and features the largest high-rise floor size, at up to 18,100 square feet, in the city. Additionally, the building has 1,254 car parking spaces, in a part of the city with relatively sparse parking options.

Klaus Kortebein, CBRE GI’s managing director of global key accounts, said the firm’s investors were looking for global diversification. “We offer expertise in target investment markets as well as client service in the home-country, providing seamless cross-border solutions,” he said.

“As Vienna is the second largest German-speaking city globally, it continues to be an important business hub with attractive pricing/risk premiums. IZD Tower offers our clients an exceptional core property investment with a stable and well-diversified income source,” he added.

The transaction marks a significant profit for SIGNA, who bought the asset for around €212 million in 2010 in the aftermath of the global financial crisis. The tower’s previous owner was UK real estate fund Matrix Securities, which paid €247 million in 2006.

Christoph Stadlhuber, SIGNA’s chief executive officer, said the tower’s “unique” reputation and status in Vienna made it an attractive proposition for CBRE GI.

“From the outset, the buyer was aware that the IZD Tower is a unique, well situated office building with excellent infrastructure. With CBRE GI, we have been able to achieve a great outcome for the sale of the IZD Tower,” he said.

“We have managed to maintain the tower’s status as a Grade A trophy asset through continuous and state-of-the-art asset management since acquisition in 2010,” he added.

Sigma was advised by CBRE and Eastdil Secured.

CBRE GI is a global real estate investment management firm with $89.7 billion in assets under management as of March 31.