Acquisition

18 Jun 2007 07:01

Fabian Romania Property Fund Ltd18 June 2007 18 June 2007 Fabian Romania Property Fund Limited ("Fabian Romania" or "Fabian") Fabian Romania acquires the Baneasa Business Center in north Bucharest fromImmoconsult for €23.9 million Fabian Romania is pleased to announce that it has entered into an agreement topurchase its seventh office project in central north Bucharest from ImmoconsultLeasinggesellschaft m.b.H, with a transaction value of €23.9 million. Oncerefinanced, Fabian Romania's net equity investment will be €5 million. Theannual rental income is approximately €1.85 million per annum. Since itsAdmission to AIM, Fabian Romania has entered into four investments committingapproximately €34 million of the funds raised. The Baneasa Business Center provides 9,600 square metres of lettable space andis fully let. It is located in the central business district of north Bucharestand has a highly visible and prominent 32 metre frontage to Bucaresti-PloiestiSt, which runs directly north to the International airport. The immediatevicinity is well serviced by the main transport systems of Bucharest, and iswithin one of the fastest growing development locations of the city for bothoffice and retail estates. The Bucaresti-Ploiesti highway leads directly fromthe city center to Ploiesti City and links to the main E60 road to Brasov andTransylvania. The building offers good flexibility, having been constructed in three phases ina "Z" shape. Phase 1 of the building comprises a ground floor plus seven levels,whilst phases 2 and 3 both provide ground floor and nine upper levels, all werebuilt to Class A specification. Overground and underground parking facilitiesprovide for 132 vehicles. The Baneasa Business Center is currently fully let to fourteen internationaltenants, including Wrigley, Colgate, Fresenius, Cargill and Volksbank. There area variety of reversionary leases at rents between €12 per square metre to €16per square metre, providing an annual rental income of approximately €1.85million per annum. Concurrent with signing the acquisition Fabian has concluded debt financing withthe vendor's parent company Investkredit, via an 80 per cent. facility, reducingthe net equity requirement of Fabian Romania to approximately €5 million. Thisis the fourth credit facility Fabian has agreed with Investkredit in Romania. Claudius Ferentz, Managing Director of Investkredit Romania, quoted "This isanother exciting acquisition for Fabian and we are very pleased to have againpartnered them in providing an excellent financial services in a competitiveenvironment". Investkredit used the same team as per previous Fabian transactions, whichincluded Salans advising on legal aspects and NNKP representing Fabian. Responsible for the acquisition, Mark Owen, Property Director of Fabian Capital,Fabian Romania's investment adviser said: "This is further exciting news from Fabian, with three transactions announcedover the last three weeks. This acquisition adds an exciting asset managementopportunity to the Fabian Romania portfolio and has been converted from thepipeline discussed with investors at AIM admission. Over the medium term weshall aim to renegotiate the tenants' leases as they come up for renewal tocreate added value. The building is extremely flexible in design and is able toprovide floor plates between 700-1000sqm for which there is a shortage in themarket. Our ability to purchase a building of this type clearly sets us apartfrom our competitors and enables us to diversify in a fast moving emergingmarket". The lead advisers on the transaction were Eurisko (property agent), WSP(technical adviser), NNKP (legal adviser), KPMG (financial and tax adviser) andBiris Goran (legal advisor to Immoconsult) For Comments: Fabian Romania:Mark Holdsworth +44 20 7499 9988 Nominated Adviser:Deloitte & Touche LLPJames Lewis +44 20 7936 3000 Broker:Shore Capital Stockbrokers LimitedDru Danford +44 20 7408 4090 This information is provided by RNS The company news service from the London Stock Exchange