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First Sponsor acquires Dutch office portfolio for 205.6m euros with 3 co-investors

Saturday, November 14, 2015 - 10:45

FIRST Sponsor Group Limited has enlarged its footprint in the Netherlands by brokering another deal, this time with three other co-investors, to acquire a portfolio of 16 offices in the country.

The group, whose major shareholders are Hong Leong Group Singapore and Tai Tak Estates, led the consortium in a sale and purchase agreement to acquire all the issued shares in Delta Lloyd Vastgoed Kantoren BV (DLKA) for 205.6 million euros (S$313.8 million).

This consideration sum includes tax adjustments, rental incentives, estimated working capital and transaction costs.

Delta Lloyd NV (Delta Lloyd), the holding company of the seller Delta Lloyd Levensverzekering NV, is a Dutch financial services provider focused on providing insurances and pensions in the Netherlands and Belgium.

This deal grants First Sponsor immediate access to a portfolio of 16 office properties across the Netherlands as well as a 50 per cent interest in VOF De Omval that holds retail spaces near the Mondriaan Tower. The portfolio has a total lettable area of 164,000 sqm housing over 90 tenants.

Some of the offices are located in key business cities such as Amsterdam, Rotterdam, The Hague, and prime residential areas in Zeist and Bilthoven.

First Sponsor CEO Neo Teck Pheng said the acquisition is expected to generate a net property income yield of 6.1 per cent after transaction costs.

"It will further boost the group's recurrent income base in the Netherlands from the addition of quality core properties with a strong tenancy profile, including the Mondriaan Tower, the second tallest building in Amsterdam which houses inter alia the headquarters of Delta Lloyd NV and Rabobank Amsterdam," he added.

"This acquisition will serve as a means for the group to diversify into property development in the Netherlands through strategic cooperation arrangements with local Dutch developers and/or property consultants."

The other three co-investors are two Netherlands-incorporated investment holding firms Cobb and Maleny, and one high net-worth Dutch individual. First Sponsor, Cobb and Maleny will each hold 33 per cent of DLKA while the Dutch individual will hold one per cent of DLKA.

Upon completing the deal, the consortium plans to rebalance the financial capital structure of the target portfolio.

First Sponsor had in March acquired its first office building in Amsterdam, Zuiderhof I, in the city's new business district South Axis together with Tecity Group and two high net worth individuals for a total of 51.5 million euros (S$77 million). Later in June, it snapped up two hotels in Amsterdam Southeast - a Holiday Inn and a Holiday Inn Express - with 509 carpark lots for 54.6 million euros.

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