Singapore’s IREIT Global Acquires Barcelona Office Bldg
SPAIN – Singapore-listed IREIT Global has bought a Grade A office building in Barcelona, Spain, for €27.2 million (S$43.1 million), according to filings published on Singapore’s bourse (SGX) on Friday morning (24 September).
Specifically, IREIT Global’s wholly-owned unit Sadena Real Estate, S.L.U. has signed a public deed of sale with seller Inmobiliaria Colonial, SOCIMI, S.A. The acquisition was completed on the same day.
Located within a business park in Sant Cugat del Vallès, the freehold commercial property known as Parc Cugat has a gross leasable area of roughly 15,510 sq m (166,948 sq ft).
The asset’s office space has a committed occupancy level of 76.5 percent, but the vendor has agreed to provide a rental guarantee for the vacant space on the ground floor for about 15 months. The commercial property is currently leased to 5 major blue-chip firms, including Grupo Escada, KLB Group, and Kyndryl (spin-off from IBM), over long lease tenures.
Aside from that, Parc Cugat has a weighted average lease expiry (WALE) by gross rental income (GRI) of about 6.8 years and generates an annual GRI of around €1.5 million as of 23 September 2021.
“The property has enjoyed high occupancy rates historically until the ground floor became vacant in May 2020. With active asset management initiatives, we believe there is room for potential upside by filling up and optimising the use of the vacant,” said the manager of IREIT Global.
“Furthermore, there is opportunity for positive rental reversions by bringing some of the under-rented contracts to market levels. Since the acquisition of the four existing office properties in Spain in December 2019, IREIT Global’s manager has demonstrated that it has been able to increase the office occupancy rate of the Spanish portfolio from 89.2 percent to 93.5 percent as of 30 June 2021 and secure several lease extensions notwithstanding the challenging economic backdrop,” it added.