“Living” sector activity defies pandemic threat

Recent market activity has underlined the strength of the “living” sector in Europe with investors apparently undeterred by the potential economic fallout from the pandemic and consequent lockdowns.

Henderson Park and Hines just announced the acquisition of a 71,000 sq m site in Athens, Greece, where they will jointly develop a premium residential-for-sale complex.

Acquired off-market from the Benaki Museum, the site is located in the affluent residential suburb of Voula, and will be built out over the next four years as a master-planned community of more than 400 units with shared amenities.

Henderson Park and Hines said in a statement that as most of Athens’ residential stock is more than 30 years old there is pent-up demand for quality product.

This transaction is Henderson Park’s and Hines’ third Greek joint venture, although previous joint activity in the country has been in the hotel sector. However, the companies have jointly developed 1,730 student beds across Spain and the UK.

Henderson Park and Hines’s Voula site, Athens.

Berlin-based Catella Residential Investment Management has paid €60 million for four assets in Brussels, Ornex near Geneva, as well as in Berlin and Potsdam on behalf of the Catella Residential III fund.

The acquisitions include: a modern 65-unit block in Brussels for €25 million; a complex of 33 houses and 12 apartments in Ornex, for which €20 million was paid; two blocks in Potsdam  which comprise 27 apartments and cost €10 million; and 10 apartments in Berlin for which €3.2 million was paid

Catella European Residential Fund III manager Patrick Au Yeung said that the firm expects the current strong interest from institutional investors will continue. In the case of Brussels, he said the city remains a key target because of its importance as a financial centre and because it is the capital of the European Union, and yet the cost of living there is affordable compared to other large European cities.

The projects are backed by capital partners PGIM Real Estate through its European value-add debt platform with senior debt provided through Investec.

Although the trajectory of recovery from the Covid-19 pandemic is uncertain and likely to vary from country to country, a recent global survey by property consultant Knight Frank found that one if four respondents were likely to move as a result of the pandemic. The survey however revealed that two-thirds of respondents are likely to continue working from home after the pandemic, increasing emphasis on the quality of domestic space. However, 56% of respondents also expected the value of their property to fall as a result of the pandemic.

Meanwhile, apparently undeterred by the current disruption in the UK university sector Chicago-based property investor CA Ventures has kicked of a $1.1 billion student housing development campaign in Europe and has formed a new management platform, Novel Student.

CA Ventures is seeding the platform with three of its existing UK projects in Glasgow, Edinburgh and Sheffield. These projects, which will provide 897 beds in total and are targeting the start of the 2021-22 academic year, represented CA’s first foray into European purpose-built student accommodation. At the time, the company said it planned to invest $625 million per year to develop student housing in the UK and Ireland by 2021. Other projects are scheduled to deliver in 2022 and 2023 across the UK, Ireland, Spain, Italy and Poland.

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