DTZ Investors said on July 3 it has bought the entire stake in Main Point Pankrac commercial property in Prague, Czech Republic, for 130 million euros ($146.7 million).
The deal represents a net initial yield of 4.5 percent. South Korean institutional investors Koramco Asset Management and Hana Financial Investment joined the deal as limited partners of a DTZ Investors fund.
An external view of Main Point Pankrac
The purchase is expected to deliver a cash-on-cash return of 7 percent to investors, with debt procured at 60 percent loan-to-value and an all-in-rate of 1.4 percent, according to global real estate service company Cushman & Wakefield.
Located in Prague’s Pankrac district and developed in 2018, the commercial property comprises 23,500-square-meter of mixed-use accommodation over 10 stories and 406 parking spaces in three underground floors. The key tenants include McKinsey, Unipetrol and a subsidiary of BNP Paribas.
“Korean capital is moving to Central and Eastern Europe to balance the exposure in European markets and to benefit from cheaper financing as well as softer yields compared to other real estate markets in Western Europe,” said Kim Jong-han, partner at Cushman & Wakefield EMEA.
“(Korean investors’) interest in Czech Republic real estate has been increasing over the past 12 months, particularly from international capital markets.”
DTZ Investors is a European asset manager wholly owned by Cushman & Wakefield. It is responsible for managing $12 billion of European properties for long-term institutional investors.
By Son Ji-hyoung (firstname.lastname@example.org)