Skanska Commercial Development Europe has sold a portfolio of four office buildings in two Polish regional cities. A fund managed by the Swedish fund manager Niam has purchased two investments in Krakow, Kapelanka 42 A and Axis, as well as buildings A and B at the Silesia Business Park complex in Katowice. This is the largest sales transaction conducted this year in the CEE office market and the largest transaction in the history of Skanska’s activity in this region.
Announced for sale in March, the four-building offer providing more than 63,000 sqm of office space has joined Niam’s real estate portfolio.
“Niam is happy to acquire a portfolio of A-class buildings with a strong tenant mix from the leading developer in the region”, said Johan Bergman, CEO of Niam.
“Our first portfolio sale in the CEE region confirms the trend of increasing investor interest in the Polish regional markets. It is a consequence of there being profitable office product available in cities such as Krakow and Katowice that offers very attractive yields. Skanska saw great potential in the Polish regional cities a few years ago and today we can say that, as a developer, we have become a transactional leader in these regional markets. More and more international investors are putting trust in our in-depth market knowledge and appreciate the quality of Skanska’s office developments, which is a very important commendation of our operations in Central and Eastern Europe,” said Adrian Karczewicz, Transaction Director at Skanska Commercial Development Europe.
Regional cities continue to strengthen their position on the CEE investment map, especially in Poland, where almost 60 percent of transactions in the first half of 2015 were concluded outside of the capital. Investors increasingly appreciate the economic potential of these locations. Krakow is a mature market with its position consolidated on the international business map. The city was ranked 9th in Tholons Top 100 Outsourcing Destinations 2015, and is a first-choice location for new, modern service centres in Poland. About 1,600 students graduate in engineering, technical subjects, economics, administration, IT and languages from Krakow each year, becoming potential employees in this sector. BPO and SSC centres are the main tenants of office space provided by Skanska, so the company is developing new projects in the locations most attractive to foreign businesses.
Kapelanka 42 was Skanska’s first office investment in Krakow. Building A, with a total gross leasable area of 18,000 sqm, was commissioned for use in the third quarter of 2014 and is already almost fully let. The building has attained LEED Gold certification. Axis was the developer’s second office project to be realized in the city. The completion of work on the investment is planned for the fourth quarter of 2016. The building offers 21,000 sqm of total gross leasable area and is nearly 50 percent let. ABB has recently signed a contract to lease 10,000 sqm.
Katowice, a city of more than 300,000 inhabitants, was ranked 2nd in the fDi Polish Cities of the Future 2015/16 list. The city’s Special Economic Zone, the international outreach, and strategy of approaching investors are creating a great business environment for global players. These characteristics, among others, make Katowice an interesting investment destination. Apart from favourable economic conditions, this location provides high-quality office buildings, such as at Silesia Business Park. This complex was Skanska’s first office project in Katowice. It will comprise four buildings, each with a gross leasable area of 12,000 sqm. Building A had its official opening in February 2015 and is already 80 percent let. In September, the building obtained LEED Gold certification. Building B will be commissioned for use in the second half of October 2015. It is already 50 percent leased.
The sale of the portfolio is an important step in the business activity of Skanska Commercial Development Europe. In the next few years, the company is set to further strengthen its position by investing in Polish regional cities and the CEE markets. Skanska is currently working on five office projects in the Polish cities Warsaw, Poznan, Katowice, Krakow and Lodz and is also active in the capitals of Hungary, the Czech Republic and Romania.favourable
Skanska was supported in the sales process by international consulting firms CBRE and Colliers International, who were instructed as exclusive agents for the transaction. Legal advice was provided to the developer by Dentons and to Niam by Linklaters.