Geneva, the 28th of June 2022
AB Alternative Fund SICAV-SIF – European Real Estate Sub-Fund (“the Fund”), an open-ended Luxembourg based fund, which invests in commercial real estate in Western Europe, announces the successful disposal of one of the Fund’s assets located in Hoofddorp, the Netherlands. The property had been acquired in 2017 and was sold on 15 June 2022 to a large investment group.
With Schiphol International Airport only 3km away, as well as a close proximity to Europe´s largest commercial harbour in Rotterdam, the property is ideally located and encompasses 10’551 sqm of leasable area, fully let to the Dutch fashion retailer Scotch & Soda. The property was designed by the renowned Dam & Partners Architects from Amsterdam, and is a distinctive eye-catcher not only providing efficient logistic space, but also a very pleasant office to work in.
During the last two years, extensive asset management work was performed on the asset, including the signature of a new long lease contract in Q4 2020. Subsequently, the asset was well positioned for disposal and the portfolio management team received several unsolicited offers during early 2022, resulting in a swift off-market process.
The returns on this transaction are outstanding and demonstrate the continued ability of the portfolio management team to deliver strong performance to the Fund’s investors in a challenging market environment. The net levered IRR stands at 11.4% since acquisition and an equity multiple at 1.8x was achieved. This asset had also been a great contributor to the income performance of the fund delivering an average annualised 8.91% cash-on-cash throughout its five year holding period. This transaction demonstrates the proven successful strategy to invest in small to medium size logistics assets benefitting from the e-commerce transition to secure both income and capital growth.
Daniel Deléchat, Head of Asset Management at Arab Bank (Switzerland) Ltd., comments on these excellent results: “The asset was sold in line with its initial business plan after providing the expected returns. We are delighted to have completed a swift transaction with a leading EU real estate investment company in such challenging market conditions.”
Our Asset Manager, Savills Investment Management, and our legal advisors in Luxembourg K&L Gates Volckrick and, in the Netherlands, HVG Law, advised the Fund on this transaction.