Natixis Pfandbriefbank finances Henderson Park’s Berlin office purchase – Exclusive

Natixis Pfandbriefbank, the German subsidiary of the French commercial and investment bank, has provided €129.5 million of debt to finance private equity firm Henderson Park’s latest investment in the German real estate market, Real Estate Capital has learned.

The London-based investor this month completed the purchase of four grade A office properties which form part of the Schützenquartier complex in Berlin’s Mitte area from investment manager Caleus Capital. The deal is Henderson Park’s fourth in Germany in the last 12 months, bringing its portfolio in the country to more than €500 million.

Natixis provided a €121.25 million senior loan, plus a €8.25 million capex facility. The financing is understood to reflect a loan-to-value ratio of around 62.5 percent, implying Henderson Park bought the properties for around €200 million.

In its announcement, Henderson Park said that it had obtained a “competitive senior financing package” due to the asset’s prime location and strong tenant base.

The loan finances four of the 12 buildings which form the Schützenquartier, located close the historic Checkpoint Charlie and Gendarmenmarkt square. The complex was built in 1998 on land formerly occupied by the Berlin Wall.

“The city has a constrained supply, likely to be exacerbated by covid-19 delaying new developments,” Henderson Park founding partner Nick Weber said.

A third of the properties are leased to an occupier related to the German government on a recently signed 10-year lease, with the remainder of the buildings multi-let. The buildings contain some vacancy, which Henderson Park said presents an opportunity to capture the property’s rental reversion potential. Among its plans, it intends to consolidate units and upgrade the quality and appearance of the buildings. Real estate investment manager Stoke Park Capital will asset manage the properties.

According to data from consultancy CBRE, office-take-up in Q1 2020 was 129,000 square metres, down 38 percent year-on-year. However, vacancy stood at 223,000 square metres, a 25 percent decrease from Q1 2019. The vacancy rate stood at 1.2 percent, down from 1.6 percent in Q1 2019.