Hines has acquired a 30,000-square-meter portfolio of eight prime sites in France, across Paris and key regional cities.
Hines will develop a series of Build to Rent (B2R) residential schemes, on behalf of the Hines Pan-European Core Fund (HECF).
The acquisition represents HECF’s first entry into the French residential market, Hines said.
In total, the sites will provide 500 units of living space across five prime locations in Paris and three regional cities in France. The assets are located in undersupplied residential markets, each with close links to public transport and surrounded by local amenities.
HECF will forward fund the delivery of the projects, having agreed a partnership with Kaufmann & Broad (K&B), the France-based publicly listed real estate construction company. K&B will lead the development of the properties.
“While we continue to increase the fund’s exposure to the logistics sector, this acquisition represents a key milestone in the execution of our strategy to diversify into the living sector. The B2R sector is a nascent sector in France so we are pleased to be early entrants to a market which is benefiting from strong demographics and other fundamentals, and where we believe there is elevated demand for high quality, well-located flexible accommodation, particularly from young professionals,” said Peter Epping, Senior Managing Director and HECF Fund Manager at Hines.
“This acquisition marks our first foray into the B2R sector in France and builds on our other recent successful transactions. We’re excited to be entering the burgeoning living sector and have a strong team on the ground in France. In addition, we’re delighted to be partnering with one of the country’s best known and highest regarded residential developers in Kaufmann & Broad to deliver these exciting projects,” added Xavier Musseau, Senior Managing Director and Country Head of France at Hines.
“This first agreement with Hines in France illustrates our desire to support public and private institutional investors, both French and international, toward rental housing and to establish a quality relationship with them over time. Our share of sales to institutional investors is increasing and we expect this trend to continue. The institutional rental investment market should be increasingly strong to meet the growing housing needs in the country and we will continue to support institutional investors to develop their rental offer in France, especially in our busiest cities where there are supply constraints,” said Nordine Hachemi, President and CEO of Kaufman-Broad.
Hines was advised by Lasaygues, the residential real estate consultancy, Ikory Asset Management for due diligence, the law firm Lacourte Raquin Tatar, and PWC for taxation advice. Kaufman and Broad was advised by CBRE on the transaction.