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Meyer Bergman, Thor JV sells €490m Parisian retail asset

The sale of the asset, which the partners acquired for €250 million in 2013, represents an IRR of 64.4 percent and a 3.8x multiple. 

A joint venture between Thor Equities, the New York-based real estate fund manager, and Meyer Bergman, the London-based real estate investment manager, has sold a commercial building on one of the French capital’s most famous thoroughfares for around €490 million.

The 120,000 square foot property, 65 Champs Elysees, is located on the Avenue des Champs-Elysees, just five minutes’ walk from the Arc de Triomphe, and has current tenants including Nike and Tommy Hilfiger. Other tenants in the area include Hermes, Guerlain and Hugo Boss.

The buyer is understood to be a Middle Eastern investor who has requested to remain anonymous.

The deal represents a significant coup for the joint venture who bought the asset for a figure thought to be around €250 million in 2013, resulting in a €240 profit in just three years. It is understood that the deal also represents an IRR of 64.4 percent and a 3.8 x multiple. Thor and Meyer Bergman declined to comment.

Demand for commercial buildings in downtown Paris is rising as institutions and wealthy individuals seek investments that offer higher returns than bonds, said a person close to the deal. Growing tenant demand, he added, has helped to drive up rents for some properties as the French economy improves.

According to data compiled by BNP Paribas Real Estate, investors spent more than €1.2 billion on retail assets in France in the first quarter, a nine percent increase compared to a year ago.

Last summer, Thor Equities was understood to be on the market to raise three new funds, ranging from $400 million to $1 billion in size. Through the funds, the firm was thought to be pursuing various value-add investment strategies in major urban markets in the US, Europe and Latin America.

The firm was also in the news following a double hire around the New Year. In January, Thor promoted Melissa Gliatta to chief operating officer of its North American business, the company’s largest. While in December, it appointed Ara Adjennian as executive director of European investments. Adjennian runs the firm’s Paris office, which is also situated on Avenue des Champs Elysees.

Last month, Meyer Bergman acquired two retail assets in Dublin for a combined fee of €110 million. The firm made further forays into retail last year when it bought two properties in London, one in upmarket Mayfair and other in trendy Borough Market for a total of €380 million.