Dutch pension fund PGGM has formed a €250 million joint venture with French real estate firm Foncière Atland to buy offices in Paris and Ile-de-France, the French capital’s surrounding area.
?The partnership will target investments that offer growth potential through asset management initiatives such as re-letting, re-gearing of leases, refurbishment, redevelopment and extension infill, PGGM said.
A first asset, located in Rue de la République, in Montreuil, has already been bought for the JV, which will focus on properties offering growth potential through re-letting, re-gearing of leases, refurbishment and redevelopment. Neither firm has disclosed the price of the asset.
Foncière Atland, PGGM’s local partner, will co-invest in the joint venture, with its subsidiaries leading the acquisition process and managing the assets.
“We believe that the Paris and Ile-de-France office market offers interesting opportunities to enhance asset performance, both financially and environmentally. The partnership with local expert Foncière Atland provides us access to this promising market,” said Tinka Kleine, director of private real estate for PGGM.
The partnership is the second of its kind for PGGM this year. In January, the pension fund teamed up with Legal & General Capital, the direct investment management arm of UK insurer Legal & General, to launch a €600 million (€791 million; $859 million) UK residential joint venture partnership. The focus for the JV is to invest in the development of purpose-built private rental housing across the UK. Legal & General committed an initial £300 million, while PGGM provided the other £300 million.
PGGM has invested in the private rental sector for over 40 years, and it currently owns close to £3 billion of residential investment exposure through its strategic partnerships in the Netherlands and the US.
The real estate platform created for the French partnership, will be advised by law firm Voisin.