TG Partners IV P/S

TG Partners IV P/S invests in well-situated properties in Copenhagen. The total equity commitment is approx. DKK 144m, and the fund expects to make investments amounting to approx. DKK 400m. The equity commitment was made by the investors.

So far the fund has purchased four well-situated properties in Copenhagen and Østerbro and signed a purchase agreement for a fifth property. Once the fund has completed the final purchase it is fully invested.

EXAMPLE – NØRREGADE 18, COPENHAGEN K

This property was offered by FS Ejendomme (Finansiel Stabilitet) for a price of DKK 38m and was purchased by the fund in April 2014 for a price of DKK 29m.
The property’s 1,617 m2 are distributed across a shop in a high basement, offices from parterre (ground floor) to the third floor and a non-refurbished residence on the fourth floor. Notwithstanding its good location and condition, the property faced a number of challenges concerning re-letting risk and vacancies and a possible termination from the main tenant.

VALUE CREATION

In connection with our negotiations and due diligence we established a dialogue with the main tenant for the primary purpose of establishing the risk of termination of the tenancy in question and opportunities for value-adding initiatives. This led to the introduction of a new lease. The new lease for the entire property, excluding the retail area, involves a long period of irrevocability. We thus managed to eliminate the risk of vacancies and re-letting risks. This was clarified prior to the final decision to invest.
The fund is considering reoffering the property on the market to secure a significant profit. A quick sale is considered only because we have already managed, before purchasing the property, to create the increased value through active management.