Schroder European REIT has made its first acquisition since its initial public offering (IPO) buying an office in Paris for €37.5m.

The property is located in Boulogne-Billancourt, a prosperous suburb in the west of Paris that hosts the headquarters of several multinational companies including Renault and Carrefour.

The freehold office was bought off a net initial yield of 5.7%.   

“This is a strong start to the deployment of initial equity and consistent with our strategic objective to acquire assets with growth potential, let off sustainable rents and in supply constrained locations,” said Tony Smedley, head of continental European investment at Schroder Real Estate Investment Management.

The new REIT, which is listed on the London and Johannesburg stock exchanges, raised £107.5m in its IPO earlier this month.

Investments will be limited to 12 cities chosen for their better-than-average employment figures and economic growth prospects.