Urban Environment House to be sold to a German investor

Image: Skanska AB

The Helsinki City Board has decided to sell the Urban Environment House in Kalasatama, now under construction, to Union Investment Real Estate GmbH of Germany. The City of Helsinki intends to lease the property for the use of the City’s Urban Environment Division with a long-term lease agreement once the property is completed.

The Urban Environment House is now owned by the real estate company Kiinteistö Oy Helsingin Kalasataman Kymppi. The City has leased the land to the company with a long-term agreement. The company, which was founded by the City Board approximately a year ago, has been the developer of the project and financed the project during construction. It was decided that the entire shareholding in the company be sold to a buyer selected through a competitive bidding process. The sale price is 165 million euros and includes the plot.

The City of Helsinki decided in 2015 to construct a new building for the use of the Urban Environment Division. The building was designed and financed by the City, and it was to be leased by the investor-owner. The City would lease the property with a long-term agreement, which would include an option to extend the lease. During use, the City would be responsible for property maintenance and repairs.

The final decision on the leasing of the property is made by the City Council.

Union Investment Real Estate GmbH is an international real estate company with a good financial standing. It has been active in the real estate investment market for more than 50 years. The company personnel working with real estate investments numbers more than 400. The company’s real estate portfolio exceeds 34 billion euros. The company’s real estate investments in Finland are valued approximately at 500 million euros.

The floor space of the property to be leased for the Urban Environment Division is 27,500 square metres. The annual lease would be EUR 7.8 million. The division’s current annual leases for its offices total EUR 9.6 million.

The leasing of the Urban Environment House will be considered by the City Council at its meeting of 10 October 2018.