Atenor’s new Polish affiliate has signed a preliminary agreement to acquire long-term lease rights on two 30,500 sqm office buildings in Warsaw. These office buildings are known as the University Business Center and are located in the Mokotów district. They offer approximately €3 million in annual rental income.
Atenor is entering the most mature real estate market in Central Europe, with a highly visible property adjacent to the University of Warsaw. The site is also easy to access by public transport and by road, which is a major advantage in this submarket. In addition, Warsaw International Airport is less than fifteen minutes away by car.
The aim is to demolish and redevelop the smallest property (built in 1979), thereby increasing its current size. In parallel, Atenor will manage several tenants including HP Poland, Sodexho, Emerson Process Management and Columbia Sportswear in the second, more modern, building dating from 2000. This office block has a surface area of 22,000 sqm and offers an initial 9% return with a weighted average unexpired lease term of five-year.
Whilst developing the first building, Atenor will monitor the second building’s market suitability, which is now excellent, and consider whether to renovate or renew the leases.
In Warsaw’s southern real estate market, the lack of quality properties and stable rents is creating opportunities for developers, particularly if the buildings are well served by public transport and road access is satisfactory.
This new acquisition increases the geographic diversification of Atenor’s project portfolio by targeting dynamic European capitals that are experiencing significant economic growth. The current pre-agreement includes a condition precedent of obtaining a tax ruling, a standard procedure in the market for a transaction of this type.
