Through its strategic partners in the United Kingdom, the Kuwait-based Kout Capital team announced today that it had successfully sold the Tango Portfolio to a Germany-based institutional investor. The portfolio originally combined eleven modern office buildings located in prime locations in medium-sized towns across the Netherlands such as Maastricht, Eindhoven, and Den Bosch. The formalized exit date for the portfolio was on the 23rd of July 2018.
The Tango portfolio was acquired in 2010 and held in a limited liability partnership in conjunction to a general partner. The asset was purchased with an Amsterdam-based investment manager, as well as private Dutch investors.
During the investment hold period, the Tango partnership had established intense and comprehensive management initiatives that were mainly focused on maintaining and increasing occupancy levels in order to successfully achieve robust earnings to investors and a solid exit value. The Dutch market during the investment time period displayed many signs of volatility whereby management sought to protect the value of the portfolio by applying careful and methodical initiatives; and with constant determination, seize every market opportunity to deliver the maximum outcome for the portfolio. As a result, compared to initial acquisition management was able to deflate the portfolio’s physical vacancy by approximately 500 basis points to circa 15%, initially standing in an excess of 20%. Management was also able to improve the weighted average lease term from less than 4.0 years from the year of purchase, to 7.2 years at exit.
Moreover, during the investment period management had proficiently restructured the bank facility for the portfolio via equity injection and succeeded in improving refinance terms with the lender (“FGH Bank”).
Through persistent monitoring of the Dutch investment market and with a focused and planned holistic investment strategy for this investment, the Kout Capital team had managed to effectively extract the maximum equity out of the portfolio sale for its most-valued investors.
Kout Capital acted on this transaction as an investment manager for its trusted clients interest and were represented by Savills and DLA Piper. The investment was initially financed by FGH Bank.