European Real Estate Investment Trust says that terms have been agreed for the sale of its last real estate asset, located in La Gaude, Nice, France and formerly occupied by IBM. The completion of the sale is subject to a waiver of statutory pre-emption rights from the city of La Gaude. Subject to this the transaction is expected to complete before end of June 2017.
The net sale proceeds to EREIT will be EUR5.75 million. This represents a 38% discount to the last reported valuation of the property in June 2016.
As previously announced the Board has explored various options for the future of the La Gaude asset which has been vacant since the departure of IBM in September 2015. EREIT has been in structured realisation since 2011 and the disposal of La Gaude is a key step in completing this process. La Gaude was not liquid due to the continuing uncertainty about the potential future use of the site and the annual running costs of the property of in excess of EUR700,000. Given the mandate of the Company to sell and the material costs of operating the property, it was appropriate to execute an early disposal and progress liquidation as soon as possible.
The Board will continue to review the position with regards to repayment of capital and redemption of shares in due course.
ERET : European REIT sells last investment