ORCO’s sale of Arena Corner office building
Colliers International Hungary announced another successful sale transaction. of Arena Corner Office.
The development known as Arena Corner Office comprising of some 29,600 square meters (NLA) has been sold to Endurance Fund (ORCO Property Group) for over €60 million. The developer Raiffeisen Ingatlan, a leading Hungarian development company instructed Colliers to market the development for sale (and lease) prior to completion on a forward sale basis. After an international marketing campaign a number of potential purchasers offered but the Endurance Fund run by ORCO Property Group was successful and took possession in July 2007.
The building is a land mark structure situated on the corner of Kerepesi út and Hungária körút and provides “A” class office accommodation with ground floor retail and underground parking. There is direct access to the red metro line which is the only route directly connecting Buda to Pest. The surrounding area is undergoing vast improvements and is rapidly becoming an established business location.
Colliers International is also exclusively leasing agents and tenants such as Citibank pre-leased space within the building. The developer has an impressive record having developed a number of quality projects within Hungary such as the Premier Outlets Center, the British International School and other design and build solutions for companies such as British American Tobacco, OBI and Nissan.Hamish White, Partner at Colliers International Hungary commented that the transaction was the 5th such forward sale of an office project in the last 24 months in Budapest.
“The concept of forward selling can be attractive to both developer and purchaser, the developer obtains capital back to use in other projects and depending on the structure can collect further upside by assisting in leasing the building. The purchaser by taking some calculated risk typically obtains a higher return than acquiring a fully leased project. We received a number of offers for the development with potential investors recognizing the excellent qualities of the building and long term leasing benefits” he commented.
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