A leading European investment fund has made its second UK acquisition with the £18m purchase of a City of London office block.
AEW Europe — which bought 65-68 Leadenhall Street on behalf of its Europe Value Investors Fund (EVI) — has not named the vendor. The asset manager recently purchased 24-28 Martin Lane, close to The Monument, for the same fund.
Its latest 31,173 sq ft property is close to Bank, Aldgate and Liverpool Street Tube stations and will benefit from the future opening of the Crossrail network. It is 99 per cent let to a range of tenants within the insurance, shipping and legal sectors.
AEW, which manages €16.6bn (£11.7bn) worth of assets from its nine European offices, has said it will now refurbish office space and communal areas at the EC3 building to “increase net operating income through reversionary rental growth”.
Carsten Czarnetzki is portfolio manager for AEW Europe Value Investors. “Our second UK acquisition for EVI confirms the high quality level of asset we are targeting for the fund,” he said.
“Our purchase of 65-68 Leadenhall Street will provide a stable income return with healthy scope for growth through the deployment of select, value add asset management initiatives, supported by an environment of returning confidence in financial markets and the City’s pivotal services sectors, as well as the opening of Crossrail in 2019.”
The Europe Value Investors Fund has a total investment capacity of €700m (£496m) and has already raised in excess of €240m (£170m) of equity commitments. Czarnetzki confirmed the fund was actively seeking other investment opportunities, primarily in the capital but also in other major British cities.
AEW Europe, partnered with AEW Capital Management in North America and Asia, acquires assets directly and indirectly through joint ventures and through equity or equity-related positions. It invests in all types of real estate across Europe within Germany, France, Italy, Spain, the Benelux countries, Scandinavia and now the UK.
