Fundraising - JANUARY 31, 2014

Tristan Capital fund holds €950m close

by Andrea Waitrovich

Tristan Capital Partners has announced the final equity raise for its European Property Investors Special Opportunities 3 at €950 million ($1.3 billion), exceeding its original target by 25 percent. EPISO 3 launched in 2012 with a €750 million ($1 billion) target goal.

The value-added/opportunistic fund is the firm’s sixth fund. It invests in Western and Central European markets across office, logistics, retail and residential sectors. Its strategy is to target investment returns of 15 percent net to investors and with a maximum leverage of 60 percent loan-to-value.

Approximately 36 investors committed to EPISO3, with about 40 percent of the capital from the United States, 40 percent from Europe and Middle East, and 20 percent from Asia.

EPISO 3 has invested a portion of its capital, approximately 25 percent, ranging in investments from offices in Germany and the United Kingdom to shopping centers in Austria and Poland.

On Jan. 16, the firm announced the fund’s first deals of the year. EPISO 3 completed three separate property transactions in Austria and Germany worth a total of €110 million ($149 million). EPISO3 acquired two neighborhood shopping centers: one in Vienna for €75 million ($101 million) and one in Bremen, Germany, for €32 million ($43 million). The third transaction involved the sale of an office building in East Berlin acquired for the fund nine months ago from a CMBS vehicle. The sales price was €4.5 million ($6.1 million).

While fundraising for EPISO 3, Tristan Capital has also been deploying the €420 million ($608 million) equity from its Curzon Capital Partners III, a core-plus international fund that closed in February 2012. While it has been reported the fund is fully invested, an official statement has not been released by Tristan Capital.

Recently CCP III acquired a shopping center in the Witten, Germany, from investors including CONCEPTA Projektentwicklung and Westdeutsche ImmobilienBank. Law firm Mayer Brown, which served as an adviser, announced the deal on Jan. 27.

CCP III’s 2013 acquisitions include a class A office complex in Warsaw’s Mokotow Business District; the Bouverie Place Shopping Centre in Folkestone, England; two prime logistics warehouses in southern France from Groupe Carnivor; and two logistics warehouses in Germany, located  in the Hamburg harbor and Überherrn in the Saarland.

CCP III is also selling its acquired assets as well. In July 2013, CCP III completed the sale of the Bockenheimer Warte assets in Frankfurt for €95 million ($128 million) to a joint venture led by Aurec Capital together with Menora Mivtachim Insurance Group and another Israeli insurance company. And in July 2013, the fund sold the BBW Bürohaus Bockenheimer Warte office building in Frankfurt. Clifford Chance advised the sale.

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