Hines enters Denmark with €119m retail buy for BVK

The Houston-based real estate firm has acquired a portfolio of five assets in Copenhagen, the firm’s first deal in Denmark and its seventh on behalf of its mandate with €66bn German pension fund BVK. 

Hines, the Houston-based real estate firm, and Universal-Investment, the Frankfurt-based asset manager, have snapped up a portfolio of five prime high street assets in central Copenhagen for €119 million.

The transaction was made on behalf of the partnership’s €1.3 billion separate account with Bayerische Versorgungskammer (BVK), Germany’s largest public pension fund. The purchase is the seventh acquisition for the BVK prime high street European mandate, which was awarded to Hines and Universal-Investment in January 2016. However, it was the partnership’s first deal in Denmark.

The portfolio consists of five prime retail assets; a block of three located on Købmagergade, a prime pedestrian shopping street in the Old Town of Copenhagen, while the remaining two assets are located in the historic retail precinct, the Strøget, one of the world’s longest pedestrian shopping streets.

The five assets, which comprise 115,000 square feet, are more than 80 percent occupied in total, with a mix of international and domestic retail tenants including Superdry, Benetton, Matas, Synoptik and Sand.

The seller was London-based European property firm Avignon Capital.

“With an increasing population, growing catchment area and relatively low saturation of retail brands, Copenhagen offers an attractive investment proposition. Through active asset management and redevelopment we see the opportunity to drive rental growth and bring new operators to the area,” James Robson, said managing director of Hines Europe.

One year into the partnership, Hines said, more than 50 percent of the €1.3 billion separate account has been committed through acquisitions in Milan, Oslo, Glasgow, Manchester and Paris. According to Hines, more.

Avignon Capital also sold the Amagertorv 2 building in Copenhagen, the Danish home of Louis Vuitton, for €26.8 million in early 2016, which set a new benchmark yield for retail in the city’s market.

Eric Mounier, chief executive officer at Avignon Capital, said: “Since we entered the Copenhagen market in 2012, the local retail market has evolved due to the influx of international retailers entering the market, helping to drive the rental and capital value of Avignon’s assets. As our expansion accelerates in 2017, we will continue to look for innovative opportunities in both the Danish and wider European markets.”

Cushman & Wakefield and Red Property Advisors advised Hines and Universal-Investment on the transaction.