First Property Group, the property fund management group, announced to increase its ownership in Blue Tower, an office building located in Warsaw's central business district. Blue Tower is held as a subsidiary within "Group Properties".

Under the terms of the acquisition, the Group has acquired a 19.7% interest in Blue Tower from PKO Bank Polski S.A., together with its 22.3% interest in the tower's management company, CORP S.A. The Group now owns 48.2% of Blue Tower and 90% of CORP SA.

The acquisition price of €5.23 million was satisfied by the payment of €1.7 million in cash with the balance funded by a non-recourse bank loan. Forecast earnings from this investment amount to circa €460,000 per annum, equating to an annualised pre-tax rate of return on equity invested of approximately 27% per annum. Following this transaction, the Directors estimate that the blended pre-tax rate of return on equity of the Group's 48.2% share of Blue Tower will be approximately 38% per annum.

BWW Law & Tax Firm advised First Property on the transaction.

Commenting on the acquisition, Ben Habib, Chief Executive of First Property Group plc, said: "Part of our strategy when we first acquired an interest in Blue Tower was to increase our ownership in it and its management company, CORP S.A.. This acquisition gives us more or less total control of the management function and is a big step towards taking full control of the building itself. Blue Tower is located in a prime part of Warsaw and should continue to attract tenants seeking a superior location at cost effective rents."