Eurocastle Investment, which is managed by New York-based alternative investment firm Fortress, has acquired a €500 million ($640 million) office portfolio throughout Germany.
In one of the biggest office transactions in the country this year, the company has bought blocks in Berlin, Frankfurt, Dusseldorf, Wiesbaden, Eschborn and Sulzbach totaling 190,600 square meters from DB Real Estate, the real estate subsidiary of Deutsche Bank.
The six properties are 93 percent occupied and are all less than ten years old while the leases have seven years left to run on average.
It is the latest in a string of acquisitions by Fortress in Germany where previous high profile deals have featured large residential and non-performing loan portfolios as well as office portfolios purchased from German banks.
Eurocastle is a property company whose shares have been traded on the Amsterdam stock exchange since December.
It is initially expected to fund the deal through a combination of debt financing using a long-term fixed loan facility secured by the portfolio. However, the company has already demonstrated its willingness to raise money on the Amsterdam stock exchange to help pay for its acquisitions. Earlier this year it raised €350 million via an IPO to help pay for a €2 billion portfolio of 303 commercial properties bought from Dresdner Bank. Other deals included the acquisition of a €324 million portfolio from Deutsche Bank and the purchase of €256 million worth of retail stores.
In addition to investment properties, Eurocastle owns around €187 million worth of units in a real estate investment fund that owns a portfolio of approximately 400 Italian properties. The properties are let to Italian government agencies.