News from 06/15/2007
Boetzelen Real Estate AG is postponing the IPO it announced for June 14, 2007. As background, the firm mentioned the “present market environment.� Nevertheless, the supermarket investor wants to continue to adhere to its set expansion strategy. How this shall come to pass has not yet been elaborated on. The first IPO of a property firm since the REIT law went into effect was followed with excitement: Within a short time, Boetzelen wanted to transform itself into a REIT and had already requested pre-REIT status.
Deutsche Capital Management AG (DCM) wants to transfer 14 properties that are still currently being held in a closed property fund into a REIT. The fund's investors shall still vote on the proposal this month. Likewise, DCM is searching for a sales solution for the two residential funds it issued in 2006 with Berlin as their target market. As residential portfolio properties were excluded from REIT law, a property tendering process is being conducted.
IVG: Separation from Finnish subsidiary planned
According to press reports, IVG Immobilien AG, Bonn, wants to pull out of the Finnish market. The property concern has commissioned the consulting agency Advium with the sale of the subsidiary IVG Polar. Advium shall contact 10 possible bidders, reports EuroProperty. An auction of the Finnish subsidiary is said to be planned. IVG Polar produced operative earnings of €19mn in the year. The value of the portfolio of 36 properties is estimated at €243mn.
Hamburg: Apartment buildings in demand
Apartment buildings in good locations (e.g., Eppendorf) are achieving sales prices of twenty times net annual rent. As Joern Olaf Ridden, expert for residential properties at Colliers Grossmann & Berger further states, agents' properties scarcely still come to the open market, but go to earmarked customers. Danish buyers are said to be very active mainly in Hamburg's residential market. In comparison to Denmark, yields are said to be high, and investors hope for a price increase, comments Ridden.
Romania: Magnat plans residential project in Bucharest
Magnat Real Estate Opportunites GmbH & Co. KGaA has acquired a site in Bucharest's Vacaresti neighborhood to build residences there. On a site of 6,900 m², they will develop around 400 residences with 37,000 m² of area. The total investment volume amounts to €40mn. The project, which is only a few kilometers southwest from downtown Bucharest, lies in direct proximity to a subway station. A shopping center is currently being built in the vicinity and shall be in business at completion of the residential project. Due to the backlog of demand for residences in Bucharest, Magnat anticipates a selloff in the planning or, alternatively, in an early construction phase. “The residential market in Bucharest features high demand and vacancy next to zero,� said Magnat CEO Jan O. Rüster.