Benson Elliot’s Director of Investor Relations, Laura Coleman, shortlisted in Bisnow’s Women Leading Real Estate in 2019, for her instrumental role in the fundraising for Benson Elliot Real Estate Partners V
A joint-venture led by UK-based private equity real estate fund manager Benson Elliot Real Estate Partners V, LP (“Benson Elliot”) and Schroder Real Estate Hotels (“SREH”, formerly Algonquin) has acquired three hotels (the “Portfolio”) totalling 1,183 rooms in Disneyland, Paris. The themed hotels, which are adjacent to one another, were acquired off-market in two separate transactions for a total investment of circa €240 million.
Dream Castle and Magic Circus, both four star hotels, were purchased from Austrian real estate developers Warimpex / UBM, while Explorers was purchased from a JV managed by SREH. The investment is structured as a 50/50 JV between Benson Elliot and a consortium of private investors advised by SREH.
Disneyland Paris is Walt Disney’s only European theme park and Europe’s most popular tourist destination. The Disney market has experienced almost uninterrupted growth for the last 15 years, set to be driven further by Disney’s €2 billion expansion plan, which will be rolled out from 2021 and is the most ambitious project undertaken since the park opened in 1992.
Developed between 2003 and 2007, the Portfolio has a profitable trading profile and generates strong cash flow. Whilst the assets have benefitted from substantial investment, significant opportunities remain for the JV to create further value through the implementation of targeted asset management initiatives.
The JV has engaged SREH as the Portfolio’s manager.
Marc-Olivier Assouline, Benson Elliot Principal, said: “The Portfolio represents a collection of high-quality, cash-flowing assets being acquired at a substantial discount to replacement cost. The hotels present opportunities to optimise value and grow income through targeted refurbishment programmes. Benson Elliot has built a strong track record in the hotel sector, with over €1 bn in hotel investments and dispositions in just the last five years. This transaction marks another partnership with the former Algonquin team, with whom we have worked successfully in the past.”
Benson Elliot, the UK-based private equity real estate manager, acting on behalf of its pan-European fund Benson Elliot Real Estate Partners IV (“BEREP IV” or the “Fund”), has sold its 74.9% stake in GWB Elstertal Geraer Wohnungsbaugesellschaft mbH (“GWB” or the “Company”) to an affiliate of Thueringer Aufbaubank, a public entity controlled by the German State of Thuringia. The consideration for the transaction implies an enterprise value for the Company of €175 million.
Benson Elliot acquired the majority stake of GWB in August 2016. At the time, the communal housing company owned and managed a portfolio of c. 6,700 residential units, encompassing 402,000 sqm across 330 assets, in Gera, the third-largest city in the Federal State of Thuringia in central Germany.
Since acquisition, under Benson Elliot’s oversight GWB’s portfolio has been improved significantly, through the introduction of best-in-class leasing and operational management processes to refurbish and lease the core residential properties. Non-core and obsolete holdings were disposed of, and a comprehensive portfolio refinancing was completed with Landesbank Baden-Wurtemburg.
Joseph DeLeo, Benson Elliot Senior Partner, said: “The entire team has worked closely with the City of Gera and the senior lender to define and execute the business plan effectively. We’re confident that GWB’s new owners will continue the positive work we’ve started, further improving this portfolio responsibly for the local community.”
Benson Elliot was advised by Greenberg Traurig and VictoriaPartners. The Purchaser received legal advice from McDermott Will & Emery.
Benson Elliot, the UK-based private equity real estate fund manager, acting on behalf of its pan-European fund, Benson Elliot Real Estate Partners IV L.P. (“BEREP IV” or the “Fund”), has acquired an office building in central Warsaw from an institutional fund.
Built in 1995 and refurbished in 2012, the property comprises c. 14,100 sqm of modern office space, with ground floor retail and 96 car parking spaces. The building is prominently situated in the popular City Centre West sub-market, a dynamic business district seeing rising rents due to its central location, excellent transport links and local amenities.
Benson Elliot is planning a transformative refurbishment and subsequent repositioning of the building. The value-add programme will see an upgrade to the existing space and delivery of state-of-the-art amenities including co-working areas, an improved F&B offering and green spaces. When completed, the building’s workplace and tenant appeal is expected to be markedly enhanced, offering contemporary space in an increasingly popular area of central Warsaw.
Joseph DeLeo, Senior Partner at Benson Elliot, said: “We’ve been engaged in Poland’s regional office markets for several years, but see a compelling investment story in Warsaw now too. The Warsaw office market is seeing rising take-up, falling vacancies and strong investor interest, with international companies moving to the capital to benefit from its young, well-educated, English-speaking work force. We’re well positioned to capitalise on the opportunity and look forward to delivering an exciting new urban workplace in this increasingly sought-after locale.”
Benson Elliot was advised by Dentons and Reesco and has engaged Syrena Real Estate as local operating partner.
The acquisition represents the fifth transaction in the firm’s Polish regional office strategy.
Diamentum is a 9,300 sqm, grade A office building, prominently situated in Wroclaw’s Western office district. The building, delivered earlier this year, is arranged over eight floors and provides surface and underground parking for 100 cars. Diamentum has been awarded a BREEAM – Very Good environmental certification.
Benson Elliot’s Polish regional portfolio now totals c. 55,000 sqm of grade A office accommodation across Poland’s key regional markets: Kraków, Gdańsk, Łódź, Poznań and Wroclaw. The assets are well-let to international and major domestic tenants, recently-developed or re-developed to a high specification, and situated in central locations in their respective markets.
Joseph DeLeo, Benson Elliot Senior Partner, said:
“The acquisition of Diamentum fits in well with our strategy of acquiring quality office assets in prime locations across Poland’s major regional markets. This is an exceptional building, nearly fully let, with a blue-chip tenant roster.”
Daniel Draga, Member of the Management Board, CFO at Cavatina Holding S.A., said:
“Diamentum, like other commercial buildings in the portfolio of Cavatina Holding S.A., was designed by our internal team of architects. This year the building also received the TOPBuilder award. We strongly believe that Diamentum raises the bar not only for the level of architectural design in regional cities, but also for the quality of office buildings developed throughout Poland. In Benson Elliot’s regional office portfolio, it will shine like a real diamond.”
Sharow Capital will manage the property, alongside the other properties in Benson Elliot’s Polish regional portfolio. Greenberg Traurig and CmT acted as advisers on the acquisition. Cavatina was advised by Dentons and CBRE.
Benson Elliot, the UK-based private equity real estate fund manager, has acquired a portfolio of three regionally dominant German convenience retail assets from Brack Capital Properties for €175 million. The Vendor has retained a minority stake in the transaction.
The portfolio comprises 100,600 sqm of lettable space across three properties and more than 3,500 car parking spaces. The centres, which serve markets outside the cities of Dortmund, Hanover and Rostock, are long-established and trade area dominant. The centres have a strong occupational history and are currently 99% let on long and seasoned leases. Tenants include occupiers with a high resilience to e-commerce penetration, including leading German grocery chains and DIY operators.
The largest tenants have recently made significant capital investments into their stores, including to support order fulfilment and regional distribution strategies, highlighting their commitment to locations and formats that would be difficult to replicate today. The asset management strategy for the properties will focus on an optimisation of lease terms and space usage, as well as an enhancement of the tenant mix. This will see the portfolio maintain its community-led offering, catering to the local demographic of each market, whilst enhancing the visitor experience.
Modulus Real Estate, the Hamburg investor and asset manager, supported Benson Elliot in the transaction and will manage the three assets.
Joseph De Leo, Senior Partner at Benson Elliot, said:
“This acquisition reflects our continued confidence in market dominant, needs-based retail formats. While there is much debate around the challenges facing the retail sector, these properties are established anchor points for daily shopping needs, resilient to e-commerce growth and of a scale that would make them difficult to replicate today. Moreover, traditional retail sales in Germany are on a positive trajectory, underpinned by favourable economic conditions, including strong real wage growth. As a consequence, assets of this nature, with their robust cash flow generating capacity, continue to be prized by institutional and other investors seeking secure cash flow streams in a low interest rate environment.”
Carl-Christoph Pieper, Managing Director at Modulus, said:
“The portfolio is extremely strong in location quality and local dominance leading to sustainable tenant demand. Although the properties are almost fully let, we will put a strong focus on optimising the tenant set-up in close collaboration with the existing and prospective tenants.”
In one of Birmingham’s largest office investment deals of 2019, Benson Elliot Capital Management, the UK-based private equity real estate fund manager, has sold 11 Brindleyplace, Birmingham to Blue Noble on behalf of Benson Elliot Real Estate Partners Fund III (“BEREP III” or the “Fund”).
Located within the 17-acre Brindleyplace mixed-use development in central Birmingham, the award-winning property provides 110,000 sq ft of grade A office space over 13 floors. Since acquisition in 2014, Benson Elliot has grown occupancy from 50% to close to 90% today incorporating F&B content and serviced, flexible accommodation.
James Jakeman, Partner at Benson Elliot, said:
“We are pleased to conclude this transaction with Blue Noble bringing total realisations from our successful Fund III regional office strategy to c. £300 m. In the context of wider market challenges, closing the sale highlights the quality of the underlying real estate and the continuing positive transformation of its micro location in Birmingham”.
Tobias Evans, CIO at Blue Noble, said:
“Following the team’s historic involvement with the wider estate, we are delighted to have acquired 11 Brindleyplace on behalf of Blue Noble Real Estate Opportunities II (“BNREO II”). Birmingham continues to benefit from a significant amount of investment, both public and private. Hosting of the Commonwealth Games in 2022 and the medium-term arrival of HS2 will further enhance Birmingham’s appeal. 11 Brindleyplace offers us an opportunity to implement our income and growth strategy with proactive and engaged asset management initiatives for the benefit of our investors and our tenants”
Benson Elliot was advised by Cube Real Estate and Savills. Blue Noble was advised by BNP Paribas, Bryan Cave Leighton Paisner and JLL Debt Advisory.
A joint venture between UK-based Benson Elliot and US-based Walton Street Capital, L.L.C. (“Walton Street”), in partnership with Schroders (the “JV”), has sold the Sheraton Hotel in Warsaw to Patron Capital (“Patron”), the pan-European institutional investor focused on property-backed investments. The transaction marks the eighth and final disposal from the Prime Europe Hotels (the “Portfolio”), a portfolio of eight full-service hotels across seven European gateway cities acquired in October 2015.
The eight freehold properties total 2,308 rooms in Venice, Paris, Milan, Rome, Warsaw, Nuremberg and Brussels, and are located adjacent to key demand generators, either in metropolitan city centres, high-growth commercial corridors or leisure destinations.
The JV has unlocked significant value through the deployment of bespoke capital expenditure programmes and asset management initiatives, including room upgrades, management contract renegotiations, and operations and revenue management optimisation. The weighted hold period across the portfolio was 18 months and the assets have all been sold ahead of underwriting, delivering over €600 m in proceeds to investors.
The Sheraton Warsaw is a five star hotel, with 350 bedrooms and is located in the centre of the Polish capital. Under its ownership, the JV deployed c. €6 million to refurbish rooms and common areas, and secured planning permission for an additional ground floor retail unit.
Marc-Olivier Assouline, Benson Elliot Principal and Director of Hotels, said:
“This has been a highly successful undertaking where we joined forces with two long-standing partners, identifying a compelling opportunity with significant value-add potential, which we have now delivered in an efficient timeframe. We achieved attractive pricing for all the assets, taking advantage of the increasing institutional appetite for hotels and delivering superior returns for our investors.”
Stephane Obadia, Schroder’s Head of Hotel Investment, said:
“The acquisition of the portfolio has been a challenging but unique opportunity to bring a new life to one of the most attractive collection of hotels across Europe. While Schroders will continue to manage the repositioning of the most significant properties, this transaction concludes a very successful collaboration with our partners, built on a common vision and a high level of trust put on our capacity to execute such changes.”
Benson Elliot Capital Management, the UK-based private equity real estate fund manager, has raised over €800 million for its latest pan-European value-add / opportunistic fund, Benson Elliot Real Estate Partners V (“BEREP V” or the “Fund”). Launched in 2018, the Fund was substantially raised in six months, with a repeat investor rate of over 95% from the prior fund. The capital was raised by Benson Elliot’s in-house team.
BEREP V was raised from a global group of c. 40 institutional investors, including university endowments, insurance companies, pension plans, sovereign wealth funds and family offices. Approximately 40% of the capital was sourced from the US, 35% from Europe, with the balance from the Middle East and Asia.
BEREP V will continue the Firm’s successful value-add / opportunistic investment approach, which has delivered a 14% net internal rate of return across prior funds. The Fund will target institutional quality assets, with a primary geographic focus on the UK, France, Germany, Italy and Spain, and a principal sectoral focus on offices, retail, residential and hotels.
Laura Coleman, Principal and Head of Investor Relations at Benson Elliot, commented: “We are extremely pleased with the speed and efficiency of this fundraise. Most gratifying is the strong support from our existing investors. It is clear that Benson Elliot’s consistent track record, generated over almost two decades, provides our investors with the confidence to entrust capital to the firm, fund after fund.”
Marc Mogull, Executive Chairman and CIO at Benson Elliot, commented: “Benson Elliot has been, and remains, a specialist in Europe’s middle markets. We have consistently delivered on our commitment to provide superior risk-adjusted returns across cycles. As with previous funds, we’ve consciously limited the size of BEREP V to avoid the deployment-driven pressures that can confront managers of larger funds. We’re fortunate to enjoy significant support from our investor partners, who co-invest alongside the BEREP funds, enabling us to pursue larger transactions. We have a healthy pipeline, but will maintain our characteristic investment discipline, prioritising opportunities that offer realisable value-add potential and a clear path to future liquidity.”
Benson Elliot’s predecessor fund, BEREP IV, had a final closing of €634 m in June 2016. It is fully committed to 18 transactions, having returned c. 50% of invested capital. To date BEREP IV has delivered realised returns of 58% IRR / 1.9x multiple.