Kuwait's Kamco acquires office tower in Cincinnati, Ohio

Published October 23rd, 2016 - 05:00 GMT
The strategic location provides returns expected to deliver an approximately 6.5 per cent yield every year. (Shutterstock)
The strategic location provides returns expected to deliver an approximately 6.5 per cent yield every year. (Shutterstock)

Kuwait-based Kamco Investment Company said it has successfully acquired General Electric’s (GE) global operation centre building, a 12-storey office tower located in Cincinnati, US.

A leading investment company with one of the largest assets under management (AUMs) in the Gulf region and an array of investments in the GCC markets, Kamco has its international office in the UAE.

Announcing the acquisition, the Kuwaiti firm said the acquired property is located within The Banks “Work, Live, Play” mixed-use development area in downtown Cincinnati, Ohio which is categorised as a Class A property.

The strategic location provides returns expected to deliver an approximately 6.5 per cent yield every year and a projected net IRR (internal rate of return) of approximately 7.1 per cent after a total investment period of five years.

The newly built-to-suit state-of-the-art facility is equipped with the latest building accessories and necessary infrastructure to accommodate a large number of offices, and consists of 339,678 sq ft of usable commercial space. The property, leased to GE on a triple net 15-year lease, started from October 2016 until 2031 with five additional terms of five years with each option extended.

Commenting on the deal, chief executive Faisal Mansour Sarkhou, said that the acquisition was yet another landmark in Kamco’s expansion plan implemented during the beginning of 2016.

He also affirmed Kamco’s strategic focus on the regional and international real estate investments across the identified core markets that provide sustainable returns to the firm’s stakeholders.

Khaled Fouad, the chief investment officer, said this investment opportunity emphasises Kamco’s ongoing determination in providing new diverse and innovative income generating asset streams.

"Kamco’s acquisition of the US Global Operations Center is one of GE’s five centre worldwide, and we believe that this prime asset offers long-term value in combination with attractive current yields," he noted.

"The Alternative Investments Department at Kamco is keen to resume developing and expanding its renowned track-record in different alternative asset classes on a local, regional and global basis," he added.

The transaction was orchestrated by the Atlanta office of Eastdil Secured, acting on behalf of Carter and 90 North Real Estate Partners for Kamco. JLL Capital Markets Debt & Equity team, based in Chicago, co-ordinated the financing, on behalf of Kamco, with Des Moines, Iowa based Principal Real Estate Investors.

The local Cincinnati office of CBRE, led by Steven Thornton, will provide property management on the asset. Assisting Kamco in completing the transaction, Ice Miller acted as legal advisors for all practices in the US.

Ernest and Young provided tax advisory services for the acquisition, while BDO USA, Centrum Investment Group, and Jones Lang LaSalle financial and professional services firm specialising in commercial real estate services, assisted in completing the transaction.

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