Europa Capital’s value add fund acquires office repositioning opportunity Germany’s R&D hotspot
Europa Capital, the pan-European real estate investment manager, in partnership with ACCUMULATA Real Estate Investment Management GmbH (“ACCUMULATA Real Estate”), announces the acquisition of the Horizon II office building in Stuttgart-Vaihingen, the R&D capital of Germany, on behalf of its latest value add fund.
Comprising c. 18,000 sq m of office space, the almost fully occupied office building has a WALT of only one year, providing Europa Capital with the opportunity to quickly reposition the building once all tenants have vacated. Works are expected to start in the summer of 2022 and will involve a complete renovation of the building, improving the office space, façade, underground parking, as well as enhancing its sustainability credentials.
The property is located on Synergie Park where over 20,000 people are currently employed and is in close proximity to the autobahn, underground and S-Bahn, as well as Stuttgart Airport. R&D investment in Stuttgart, including the Cyber Valley, a new centre for artificial intelligence, is higher than any other location in Europe, and represents c. 25% of the total volume invested across Germany.
Jason Oram, Partner & Fund Manager at Europa Capital, commented: “There has been a proliferation of commentary questioning the future of the office, but we have taken a contrarian view following the dislocation of the pandemic, and believe there are still pockets of opportunity for high quality offices in the right locations. Stuttgart is experiencing a renaissance, renowned for its association with the automotive industry, the city is benefitting from a substantial amount of R&D investment as the car industry shifts to electric power and driverless technology. We expect this to translate into significant future demand for high quality office space and, by leveraging our asset management expertise, we believe Horizon II is well placed to capture that opportunity.”
James Farmer, Partner at Europa Capital, added: “We remain confident in the outlook for offices in Germany, particularly in markets such as Stuttgart, which remain severely supply constrained. In tandem with our planned renovation works, we will invest substantially in the environmental and social credentials of the building and look forward to working closely with our partner, ACCUMULATA Real Estate, to deliver a best in class product for new occupiers.”