GE Real Estate on European spending spree

The US firm invested a total of $5.8 billion in equity and $3.9 billion in real estate-related debt last year.

GE Real Estate took assets under management in Europe to $22 billion in 2007, it has revealed, following $9.7 billion (€6.5 billion) of new investment.

The US firm, which has been mulling a bid for Spanish property company Immobiliaria Colonial in recent weeks, said it invested a total of $9.7 billion in the region last year and made €2 billion of disposals.

Describing 2007 as “spectacular”, European head of GE Real Estate, Olivier Piani, pointed out that the firm had set a record increase in the volume of transactions completed during the year. Historically, it has invested €5-6 billion each year.

Highlights included expanding eastwards to Russia by investing $50 million in new development and refurbishment fund, Heitman Russia Property Partners, which will have $150 million of equity. GE Real Estate also entered Romania for the first time.

Other high profile transactions last year were the purchase of a €205 million portfolio in Germany of 31 assets mainly in the east part of the country: a €2.6 billion non-performing loan book in Italy in a joint venture with Pirelli Real Estate and Calyon; and a joint venture with Tishman International to develop a $250 million project at Sofia airport in Bulgaria.

In the UK, the firm acquired a £2 billion portfolio of performing commercial property loans from Bradford & Bingley and the entire £417.5 million property portfolio of the UK Balanced Property Trust. The UK proved to be GE most active market, where it invested $1.9 billion overall. The next most significant country was France with $1.1 billion invested, followed by Germany, Iberia, Italy, Central and Eastern Europe, Italy and the Nordic countries.

GE has a total of $72 billion of commercial real estate under management globally.