South Korean-Finnish consortium which includes Varma Mutual Pension Insurance Company, NH Investment & Securities (NHIS) and Shinhan Investment Corp. have acquired OP Cooperative’s HQ, an office property in Vallila, Helsinki for €480 million, making the largest ever single-asset office transaction in the Finnish real estate market.
OP will continue operating in the property under a long-term lease agreement. Seoul-based AIP Asset Management and Helsinki-based Avant Asset Management acted as co-investment managers for the deal.
The office property comprises a campus, located in the address Gebhardinaukio 1, Vallila, Helsinki. The campus was fully completed in 2017. With a total leasable floor area of 74,150 square metres, the property accommodates approximately 6,000 people. Its tenants are OP and Finnish Tax Administration.
“The sale and leaseback of the Vallila property will considerably reduce OP Financial Group’s property risks and strengthen its capital base. It also frees up capital for increasing business, replacing external funding. Furthermore, the timing for the transaction was quite optimal because long-term interest rates and property investors’ net yield requirements are at record lows”, said OP Financial Group’s CFO Vesa Aho.
”Long-term stable cash flow suits well into our portfolio in today’s low interest rate environment. The large high-quality asset in the middle of the growing and developing Kalasatama–Pasila axis is in line with our strategy to focus in attractive locations with excellent public transport connections,” said Varma’s Head of Real Estate Ilkka Tomperi.
”We are investing into real estate directly and indirectly via funds and JVs. Teaming up with other likeminded investors like NHIS and Shinhan enables us to access a large asset like the Vallila campus. We have used JVs across Europe to invest in office and retail assets like Taunus Turm in Frankfurt and Skärholmen Centrum in Stockholm,” added Ilkka Tomperi.