ERES Acquires Dutch Multifamily Portfolio

The transaction, valued at $185.6 million, comes just days after the Toronto-based real estate investment trust completed a public offering to fund current and future acquisitions.
Amsterdam houses. Image via Pixabay user EvaCarinaPersson

European Residential Real Estate Investment Trust and Canadian Apartment Properties Real Estate Investment Trust have closed on the acquisition of a portfolio comprised of 18 Dutch properties for €170.5 million ($185.6 million). Known as the Eagle Portfolio, it has 943 residential suites in seven urban centers in the Netherlands. CAPREIT, ERES’ biggest shareholder, sold the properties to ERES.

The assets are located in major markets such as Amsterdam, The Hague and Utrecht, as well as smaller cities including Cuijk, Enschede, Gouda, Heerenveen, Huizen, Ijsselstein, Koog aan de Zaan, Meppel, Oldenzaal, Scherpenzeel and Warnsveld, according to CAPREIT.

CAPREIT will receive revenue fees from ERES to provide property and asset management services to the growing ERES portfolio. Located in Toronto, CAPREIT is not affiliated with the U.S. multifamily company with the same name.

In June, CAPREIT closed on the €232 million ($278.7 million) sale of a 26-property, 1,257-unit  Dutch multifamily portfolio to ERES in a deal that gave CAPREIT majority ownership and control of the Toronto-based European trust. ERES is Canada’s only European-focused multi-residential REIT with an initial focus on investments in high-quality multifamily properties in the Netherlands. ERES was formed about six months ago when CAPREIT sold 41 properties to a REIT then known as European Commercial Real Estate Investment Trust. The name was changed to better reflect the focus on multifamily assets.

In a separate deal this week, ERES closed on the acquisition of a 16-property portfolio from an institutional owner based in the Netherlands for €64.8 million ($70.5 million). Those properties comprise a combined 315 residential suites in eight municipalities and are located close to major highways, train stations, bike paths, shopping, restaurants and parks.

The value of ERES’ investment properties has increased from about €880.9 million ($959.1 million) on June 30 to more than €1.1 billion ($1.2 billion). The ERES portfolio consists of 5,116 multi-residential suites in 122 properties. It also includes three office properties—one in Belgium and two in Germany—totaling about 400,000 square feet.

Public Offering Completed

The latest ERES acquisitions come just days after the REIT completed a public offering that generated aggregate gross proceeds of C$167 million ($126 million) from the issue and sale of 40,185,000 trust units of ERES. The offering was sold through a syndicate of underwriters led by RBC Capital Markets and Scotiabank.

ERES stated it intended to use the net proceeds to partially finance previously announced portfolio acquisitions and to repay the €22.5 million ($24.5 million) outstanding balance on its existing credit facility. Offering proceeds will also be used to fund future acquisitions and general trust purposes.