M7 Real Estate has completed the sale of a portfolio of five logistics parks across Hungary, on behalf of M7 Central European Real Estate Fund I (CEREF I).
The transaction represents the largest logistics transaction by GLA in Hungary in 2019. The 84,000 sqm portfolio, which includes three assets in Budapest, one in Eger and another in Pécs, was assembled by M7 in three separate transactions during 2016 and 2017. M7 identified an opportunity to enhance the performance of these assets and reduce vacancy by implementing a targeted €4.6 million capex programme and new marketing strategies.
As a result of this activity, the average occupancy of the portfolio has increased from 63% on acquisition to 94%, whilst the total rental income has grown by 60%. In addition, the WALT of the portfolio has almost doubled to 3 years.
In a separate transaction, M7 also announced the disposal of the Atom Centre, a 2,614 sqm retail park, in Paks.
Balázs Magyar, Managing Director Hungary at M7, commented: “M7 acquired the assets in this portfolio as part of the CEREF I fund, from three different sellers. We have subsequently worked closely with our partners to implement our strategy for the portfolio, leveraging our asset management expertise, improving occupancy by 28,500 sqm. Having successfully finished our asset management plan and created an institutional quality core-plus portfolio, we made the decision to complete our business plan ahead of schedule, through this sale. This transaction, together with the sale of the Atom Centre, has allowed us to generate attractive returns for our investors.”
M7 was advised by Colliers International.
