Allianz joins Aareal in taking bulk of lending on NorthStar deal
US REIT NorthStar Realty Finance Corp. has been in the news for several sizeable deals recently, including its recent acquisition of the landmark office property Trianon in the Frankfurt business district for €540m. Last year it hit the headlines for its purchase for €1.1bn of a portfolio of 11 offices properties sold out of the liquidating SEB Asset Management open-ended fund.
The SEB deal was significant for highlighting the evolving collaboration between insurance companies and traditional bank lenders in large-scale financing projects.
Insurance giant Allianz Real Estate said recently that it had provided €365m as part of a €630m senior financing facility underwritten by Wiesbaden-based Aareal Bank against the 186,000 sqm portfolio. Apart from being one of the largest syndicated loans between a bank and an institutional investor in Europe, it is also probably the biggest real estate financing deal by any German insurance company. For Allianz it is also the first time it is financing a cross-border, pan-European portfolio with tranches in various currencies.
Aareal Bank had arranged and underwritten an initial €530m, seven-year senior facility to Northstar. The bank said the loan had been increased to €630m, taking the facility’s loan-to-value ratio to 57%.
Roland Fuchs, head of finance at Allianz Real Estate, said the deal was in line with Allianz's growth and diversification strategy. “Our cooperation with Aareal Bank has been successful, in particular with regard to structuring and documentation requirements specific to the insurance industry", he said.
Aareal's Christian Schmid, head of business and syndication, commented, “This syndication is another milestone in Aareal Bank’s cooperation with leading insurance companies such as Allianz. At the same time, it reflects our aim to win over and establish institutional investors as syndicate partners, alongside banks.”
The SEB portfolio that was sold had 11 office buildings located in Brussels, Hamburg, Paris, London, Milan, Amsterdam, Rotterdam and Gothenburg.
NorthStar followed up its big investment from SEB with a further portfolio deal in January this year, when it bought the Trias portfolio with 37 assets from German insurance company Provinzial NordWest. This included 30 office buildings, four retail assets, two hotels and an industrial property with 260,000 sqm, and likewise scattered across Europe – in Frankfurt, Paris, London, Berlin, Madrid, Lisbon and Glasgow.