News and Media

CHC buys Parisian office building for €34.4m

By Neil Callanan

The Irish wealth management company Custom House Capital (CHC) has added to its French portfolio with the €34.4 million acquisition of FuturaII, a new mixed-use office and retail building in Saint-Quentinen-Yvelines in Paris.

The six-storey-over-basement building measures 7,737 square metres, of which 558 square metres is retail and the remainder office space. It has two underground car parks, providing space for more than 150 cars.

The building, which was acquired for private clients, was completed four months ago and the offices are entirely let at an annual rent of just over €1.7 million to Assytem, which develops products for the automobile, aeronautical and energy sectors.

The company, which is listed on the Paris stock exchange, has taken a nine-year lease on the building.

The property’s gross yield is 5.8 per cent, and the net initial yield is 5.26 per cent. The retail area is allocated for a restaurant or bistro, and there is a rental guarantee in place on the unlet ground floor space, which is currently under negotiation. Knight Frank in Dublin acted for CHC.

Saint-Quentin-en-Yvelinesis is in west Paris. Many international firms such as Amazon, BMW, Nissan, Bougues and Renault are based there.

‘‘We are very happy with this acquisition, as it adds to our already-growing French portfolio,” said Harry Cassidy, chief executive of CHC. ‘‘Our investors are strongly attracted by the net initial yield on this property, which compares very favourably to yields achieved elsewhere in the Paris region.”

The deal means CHC, which was set up in 1997, now manages more than €1.25 billion worth of assets for its clients. About 80 per cent of that portfolio is invested in property.

‘‘Le FuturaII is located in a strong business district, with a long-term international tenant in place, and there is evidence of rental growth in the surrounding area,” said Suzanne Fitzgerald of Knight Frank, who has advised Custom House Capital on all of its French purchases. It also takes advantage of the yield shift experienced in the latter end of 2007, offering value to investors.”

©2008 Sunday Business Post