GLL and DIFA create new joint venture in purchasing Paris office building from Generali Assurance Vie France
GLL and DIFA create new joint venture in purchasing Paris office building from Generali Assurance Vie France
For Immediate Release:
Munich / Hamburg, 10th March 2004. GLL Real Estate Partners GmbH and DIFA Deutsche Immobilien Fonds AG are pleased to announce the creation of a 50-50 joint venture in France to purchase 92, Avenue de France in Paris, a newly-constructed, 21,800 square metre office building, from Generali Assurance Vie France. The pioneering joint venture – the first of its kind for DIFA - makes use of a recent amendment in the German investment law, permitting open-ended real estate funds to take non-controlling stakes in property companies. Dr. Reinhard Kutscher, board member of DIFA, commented, “This transaction marks a watershed for DIFA. With an entrepreneurial approach to corporate share deals, we are extending our investment universe and maximizing returns for shareholders in our funds.” DIFA purchased 92, Avenue de France for its open-ended real estate funds DIFA-Fonds Nr. 1. The latest acquisition takes the DIFA portfolio in France to a total of 15 properties and projects.
GLL’s Office Fund, investment manager on behalf of several European insurance companies, bought the entire property in October 2003 and then subsequently looked for a partner to structure a joint-venture, specifically targeting German open-ended funds, who have been and remain very active investors in Paris. The total size of GLL’s Office Fund at € 600 million, with a maximum 20% allocation to the French market, determined the strategy to sell a stake in the investment. “With DIFA, we have a first class partner in every respect. They are committed to the French market and share completely our institutional, core investment philosophy”, said Rainer Göbel, GLL managing director.
DIFA, who had been exploring corporate acquisitions and participations with their advisers in France, already own France Avenue, a development project close to 92 avenue de France, and were attracted to the possibility of consolidating investment in this vibrant development area.
Generali originally purchased 92 avenue de France as a speculative, turn-key development from Bouygues Immobilier at the end of 2001. Located in the rapidly developing Parisian business district on the Left Bank of the Seine, the property is now 94% let on a long-term lease to Réseau Ferré de France (RFF), an organisation responsible for the property and infrastructure of the French national railroad system.
Michael Montebaur, head of acquisitions and asset management at DIFA, commented, “This building has the advantage of an attractive, up-and-coming location in a very deep investment market, which has enabled us to secure strong cash flows from a AAA credit tenant.” Keith Sutton, managing director of the GLL fund, added “The qualities of this property, particularly the lease with RFF, make it a perfect choice for a joint-venture structure.”
Generali France regards the sale as further proof of their pro-active asset management strategy. Anne-Marie de Chalambert, Managing Director of Generali Immobilier and newly-appointed head of Generali’s European Property Investment Committee, commented, “This exciting deal shows clearly that Generali knows how to take letting risk at the right point in the market cycle, and realize the value created by superior lease contracts.” Alban Liss, Head of Investment at Generali Immobilier, also remarked, “There has been very strong interest from the market in this investment property, but we felt that this was an ideal opportunity to strengthen our professional relationship with GLL.”
For the property acquisition and structuring of the joint-venture, GLL was advised by Gide Loyrette Nouel and DIFA by Lefévre Pelltier et Associés and Awon Conseil.
Generali Group
Generali Group is the fourth largest insurance company in Europe, with revenues of over 46 billion euros in 2002. Its subsidiary, Generali France, currently oversees operations in the Group’s third largest national market, representing 15.3% of its total revenue. Generali France has recently acquired Le Continent Assurance, as well as the French life insurance business of Zurich Financial Services. Generali Immobilier is the property asset management subsidiary of the Generali Group in France with responsibility for € 2.3 billion of real estate assets. Since 2000, Generali Immobilier has followed a strategy of diversifying its risk portfolio through increased short-term holdings.
DIFA Deutsche Immobilien Fonds AG
Hamburg-based DIFA Deutsche Immobilien Fonds AG was established in 1965 and is a capital investment company subject to the German Investment Companies Act (KAGG). The company is part of the Union Investment Group and the FinanzVerbund der Volksbanken Raiffeisenbanken alliance, and currently manages four open-ended real estate funds, including two retail funds – DIFA Fonds Nr. 1 and DIFA-GRUND – available to private investors throughout Germany via local cooperative banks. More than 600,000 investors have entrusted some 16 billion euros to DIFA, and in 2003 invested some 2.8 billion euros in the two funds. DIFA also manages the DIFA Fund No. 3 and DIFA Immo-Invest Fund for a fixed group of institutional investors.
GLL Real Estate Partners GmbH
GLL, a global joint venture between Lend Lease and European insurer Generali Group, offers commingled funds, separate account portfolios, and structures single asset syndications in Europe and the U.S. for European institutional investors, who have to date entrusted GLL with some € 1.5 billion. GLL invests on behalf of its clients in well-leased, prime office assets in strategically important world markets. Since its incorporation in October 2000, GLL has acquired several prominent properties across Europe and the United States, for example the Morgan Stanley headquarters in Madrid, an 85% interest in the 70-storey MesseTurm office tower in Frankfurt, Germany and controlling interests in Class-A high-rise properties in the CBD’s of San Francisco, CA and Washington, DC, USA. This is GLL’s first investment in France. In January 2004, GLL will launch a new Central and Eastern Europe Fund for institutional investors.
Press contact
DIFA Deutsche Immobilien Fonds AG
Communication Dpt.
Fabian Hellbusch
Caffamacherreihe 8, 20355 Hamburg, Germany
Tel: +49 40 3491 9160, Fax: +49 40 3491 9190
Internet: www.difa.de
E-mail: fabian.hellbusch@difa.de
GLL Real Estate Partners GmbH
Keith Sutton
Lindwurmstrasse 76, 80337 München, Germany
Tel + 49 89 72610-3935, Fax + 49 89 72610-3945
e-mail: keith.sutton@gll-partners.com
