Skanska’s Nordic Light Trio sold to Korean investment trust

Office Market

Skanska has sold its Nordic Light Trio office building in Budapest to JR AMC, a South Korean real estate investment trust. This is the buyerʼs first office investment in the CEE region after transactions in Vienna, Dublin, and Paris, according to a press release sent to the Budapest Business Journal.

Nordic Light Trio comprises total leasable area of approximately 14,000 square meters and 221 parking spaces. Some 98% of the space within the building is already leased, the anchor being a multinational healthcare company, notes the press release.

“This is further proof that Asian investors have a positive sentiment towards Europe and actively search for new investment opportunities on our continent,” says Adrian Karczewicz, Head of Divestments at Skanskaʼs commercial development business unit in the CEE. “On the one hand, they find CEE countries attractive thanks to the political and economic stability that they offer, which is additionally guaranteed by being part of the European Union. And on the other, prospects for the region are also promising with the return on investment being higher than in Western Europe. Asian investors are mostly interested in A-class properties developed by institutional developers, and Skanska is many times a first choice for all the newcomers.”

“A future-proof office building, almost 100% pre-leased and divested one year before completion is what I call a successful project,” adds Marcin Łapiński, Managing Director of Skanska Property Hungary. “Nordic Light Trio will be our first project in Hungary to be WELL certified and a lot of efforts were focused on sustainable solutions and innovations, having at their heart the future residents of our building. I am very proud that Nordic Light Trio attracted the attention of JR AMC and became the first asset they acquired in Hungary.”

Due to be delivered in the second quarter of 2020, Nordic Light Trio is part of the already completed and highly successful Nordic Light office complex located on the Váci Corridor, the most popular office hub and new CBD of the Hungarian capital, notes the press release.

The area around the Nordic Light complex will offer 2,400 sqm of landscaped multi-activity gardens open to tenants and neighboring communities, bicycle storage facilities with changing rooms and showers, as well as parking with charging stations adapted for electric vehicles, it adds.

Nordic Light Trio, designed by Paulinyi-Reith & Partners, is a seven-story A-class office project that will offer future-proof workplaces fully adapted to the needs and requirements of tenants, keeping their wellbeing in mind. With a specially designed office environment that will work towards enhancing the health and wellness of those working in it, Nordic Light Trio will be the first WELL-certified Skanska building in Hungary, the press release adds.

More Asian capital moving into CEE

According to a report by real estate consultancy Colliers, cited by Skanska, Asian investment capital is beginning to spread widely, also in Europe. Investors are not just interested in West European markets, however, but also in other locations such as the CEE. The region attracts Asian investors with its favorable yield premiums and higher returns on investment, the report notes.

In 2017 and 2018, the inflow of Asian capital investment into the CEE-6 amounted to approximately EUR 2.6 billion, focused mostly on the industrial, retail and office sectors, adds Colliers.

“With yields in Western Europe breaking historic records, our interest is to constantly explore new markets whereby we can achieve high yields, simultaneously minimizing any trade-off in building quality or macro risk profile,” says Hyon Suk Jang, Executive Managing Director of Foreign Investment at JR AMC. “Considering both macro/micro economic figures and also the trend of the real estate market in Hungary, we are convinced of the significant potential for further growth.”

JR AMC is a leading asset management company based in Seoul, founded in 2008, with a currently cumulative EUR 3.4 bln in assets under management. It is an active investor in global commercial and residential real estate with investments in Europe, the U.S., Japan, and Korea, according to the press release.

Skanska Hungary has been operating in Hungary for more than 30 years and is part of the Skanska Group, a world leader in project development and construction. It has developed approximately 230,000 sqm of commercial space, from which 14,000 sqm are currently under construction.

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