ADVERTISEMENT

Europa Capital sells its Budapest office portfolio

Deals

Europa Capital has concluded the sale of the Kalvin Portfolio in Budapest, which comprises two city center office buildings with a total floor area of approximately 26,000 square meters.

KGAL, a leading independent European asset and investment manager, has acquired the Kalvin Square and CityZen assets on behalf of institutional investors. The combined price of the portfolio is approximately €60.0 million. The property management will be carried out by KGALʼs local partner ConvergenCE.

“The portfolio was acquired out of a distressed position, when the buildings had a combined vacancy of around 45% and were capital-starved,” said James Pennington, Director of Asset Management for Europa Capital.  “We implemented an intensive active asset management strategy that involved a significant refurbishment and rebranding of the CityZen building, extended leases with existing tenants, and marketed and leased the vacant space.”

Pennington noted that a BREEAM ‘very good’ environmental rating was secured on both CityZen and Kalvin Square. 

“Over the two-year period of Europa Capital’s ownership, the contracted rental income has increased from €1.4 million to €4.0 million, and the weighted average lease term has significantly increased from 1.5 years to 4.6 years,” he added.

ConvergenCE Hungary provided investment acquisition, local asset, property and project management services to Europa Capital.

“Two years ago, we identified the Budapest office market as tactically compelling,” recalled Robert Martin, Founding Partner and Europa Capital’s Head of Central Europe. “With improving macroeconomic indicators, combined with a low development pipeline and a shortage of high quality space, we believed occupational and capital market dynamics would improve.  We have now executed our strategy and so delivered strong returns to our investors. We further believe in the positive development of
the Budapest office market.”

“We expanded our European growth strategy into Budapest for a very good reason,” noted André Zücker, Managing Director KGAL Investment Management responsible for Real Estate. “We see a huge upside potential for this part of the European office market.”

ADVERTISEMENT

IMF raises Hungary 2021 GDP growth forecast to 7.6% Analysis

IMF raises Hungary 2021 GDP growth forecast to 7.6%

Parliament approves amendment to Competition Act Parliament

Parliament approves amendment to Competition Act

New CEO announced at Codic Hungary Appointments

New CEO announced at Codic Hungary

Budapest bike-sharing scheme boasts record ridership City

Budapest bike-sharing scheme boasts record ridership

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.