03rd August 2021

A new joint venture between Trinova Real Estate, the well-known UK and European investor, and Europi Property Group, a pan-European real estate investment company with offices in London and Stockholm, has completed the acquisition of the Windmill Green office in Manchester, its fourth recent buy as it builds a substantial Grade-A office portfolio in the UK’s “big six” cities.

Trinova and Europi this week completed the acquisition of the 82,000-square-foot Manchester block Windmill Green from Fore Partnership.

Having agreed in September of last year to form a joint venture partnership to buy high quality offices in the largest regional UK cities, the so-called big six of Manchester, Birmingham, Glasgow, Edinburgh, Leeds and Bristol, with a strong ESG focus, the duo is now launching its joint venture partnership as CityBee, CoStar News can reveal.

Windmill Green is the fourth acquisition for CityBee as it moves speedily towards building a £200 million portfolio of city centre, high quality office assets (see The Assets So Far below).

The first acquisition in December saw it buy Minerva House in Leeds from BMO Real Estate. It then bought Cuprum in Glasgow from Credit Suisse and The Stamp Office in Edinburgh from Columbia Threadneedle.

The CityBee joint venture brings together well-known UK investor Trinova Real Estate, with Europi, a Stockholm and London based real estate investor founded in 2019 by former Blackstone executive Jonathan Willén and Brunswick Real Estate Ventures, a leading Nordic real estate investor and fund manager. Europi invests alongside an established network of local asset management partners and generates value for its shareholders through active asset management and a focus on social and environmental sustainability.

Willén said Europi has completed multiple transactions in Poland and the UK since inception, as well as imminently entering Spain and Portugal. Europi invests discretionary long-term capital principally from Nordic institutions and family offices.

Cuprum in Glasgow forms part of the portfolio. (Trinova/EPG)

Sam Resouly, Partner at Trinova, says the two companies decided to form the joint venture in September of last year after finding a shared conviction in the long-term need for great quality offices in key cities in the UK.

“Our focus is central business district offices in the top six cities outside of London. A core focus is on ESG and great transport links and we will buy standing stock or refurbishment opportunities to bring the building to best in class standard.

“CityBee will bring uniformity of branding and operation across the portfolio for existing and future assets. It is a commitment to existing and future occupiers, and a statement of quality in terms of buildings and how they interact with their local community.”

As such, a key focus is holding buildings that have strong ESG credentials, either when bought, as at Windmill Green which is BREEAM outstanding, or by injecting significant capex to make the buildings sustainable, as with its plans for Edinburgh’s The Stamp Office.

Willén says: “Sustainability is a core focus for CityBee. In terms of the wider strategy, we have high conviction for these cities, which are large metropolitan centres by European standards, and the occupational market fundamentals continue to be very attractive with minimal vacancy.”

The duo is working speedily towards creating a portfolio of £200 million Gross Asset Value with its ambition to add two or three assets at least in the near term.

Resouly says the joint venture is based on collective conviction. “When we made this cooperation, it was during a period of time when many were questioning the future demand for offices. We took a decision that well located, high quality offices close to transport links was going to remain attractive over the long term. This was a shared decision to take the counter cyclical view in a market when we were a lone voice. We met in person in our offices and concluded the future was not behind a computer screen. We have enjoyed visiting the target cities on numerous occasions, witnessing the momentum build and vibrancy and quality of interactions that contribute to our economy.”

Willén says ultimately there was a good chemistry and a shared vision for the future of offices. “We feel this is a really special collaboration and have high aspirations for CityBee.”

The Assets So Far

Trinova/EPG have speedily bought four UK assets for the CityBee joint venture. They are:

Minerva House, Leeds, a 59,059-square-foot office bought in December as the first purchase on 29 East Parade, multilet to tenants including Gateley, Stowe Family Law and FRP Advisor. The transaction was reported on here.

Cuprum in Glasgow, a 96,267-square-foot eight-storey office on Argyll Street leased to SAS Software, AXA Insurance, Teleperformance and Citres. CoStar News reported on the transaction here.

The Stamp Office, a 52,177-square-foot Edinburgh Georgian office leased to Scottish Legal Complaints Commission, The Scottish Ministers, Covance, Queryclick and Senvion. CoStar News reported on the transaction here.

Windmill Green, an 80,999-square-foot Manchester office leased to flexible offices platform Hana, Odyssey Interactive, Oscar Recruitment and OneStream.