News from 07/10/2008
Pramerica/Ideenkapital: Chrysler Building in New York sold to sovereign wealth fund
The Chrysler Building in New York was sold to the Abu Dhabi Investment Council (ADIC) sovereign wealth fund for $800mn. The previous owner was the object company TST/TMW 405 Lexington, L.P., in which the U.S. property fund ProVictor Fund VI holds 75% and Tishman Speyer 25%. The object company acquired the 319 m tall skyscraper in 2001 for $390mn. The U.S. property fund series “ProVictor” was originally initiated by the Provinzial Rheinland and Victoria (now ERGO) insurance companies. The acquisition and administration of the object was performed by Pramerica Real Estate Investors (previously TMW), and the marketing for and advising of the investors was carried out by Ideenkapital AG. Ideenkapital announced that, according to preliminary calculations, net proceeds of the sale after taxes for the investors in ProVictor VI will be up to approximately 188% of the equity originally invested. Including previous distributions, the sale would yield an average annual return of around 18% before taxes.
Dresden: HLG and city agree on €100mn shopping center at main station
At Wiener Platz at Dresden's main railway station, construction of a shopping center costing approximately €100mn could commence in 2009. HLG Projektmanagement GmbH based in Münster and the municipal administration have reached an agreement regarding the sale of the building lot, City Treasurer Hartmut Vorjohann (CDU) told the daily newspaper Sächsische Zeitung, adding that the sales contract will be presented to the city council after the summer vacation. A new building with approximately 28,000 sqm of lettable area for some 80 shops and 155 underground parking spaces is planned. HLG project manager Christian Diesen told the paper that financing is secured through such partners as IKB Deutsche Industriebank. The center's design is by Siegbert Langer von Hatzfeldt in Dresden and WMB Architekten, Berlin.
Greifswald: City sells 49.9% of its residential company to KWG
The city council of Greifswald decided to sell 49.9% of its residential company Wohnungsbau- und Verwaltungsgesellschaft mbH (WVG) during a public meeting. The municipal enterprise owns a total of 10,053 residential and 140 commercial units. In total, the lettable area runs to about 584,000 sqm, with a 5.4% vacancy rate. The buyer of the shares is Kommunale Wohnen AG (KWG), Bremerhaven,, which thus expands its inventory to around 15,000 residential units. According to KWG, the purchase price amounts to 9.4 times the annual net rent without utilities, meaning €500/sqm and a gross return of 10.7%. According to media reports, approximately €60mn were offered.
BSA: Norwegians plan further investments in Germany
The Norwegian fund company BSA Capital AS is planning further object acquisitions in Germany for its Prime Office Germany AS fund. For this purpose, the Norwegians have received €125mn in credit from the Landesbank Hessen-Thüringen (Helaba) and the Bayerische Hypo- und Vereinsbank (HVB). According to the firm, the investments are to be made before the end of the current year. The Prime Office Germany fund is investing in office buildings in Berlin, Hamburg, Düsseldorf, Frankfurt and Munich. The BSA group is also active on the German market with its fund BSA Berlin, investing exclusively in residential buildings in choice sections of Berlin.
DTZ: German subsidiary increases revenue and profit
The British DTZ Holdings plc. increased its group revenue during the 2007-08 business year; however, its profits fell. Compared to the previous year, group revenue climbed by some 44% to 446.3mn GBP (2007: 310.3 GBP). Group profit before tax and before exceptional items fell to 20.6mn GBP (2007: 38mn GBP), Group profit before tax, after exceptional fell to 5.6mn GBP (2007: 41.8mn GBP). The German DTZ subsidiary presented better results, stating that its revenue rose by approximately 52% and its profit by around 28%. During the period reported on, DTZ Deutschland doubled the number of its staff members from 180 to 390 at the present time. Jörg Nehls, the Business Manager of DTZ Deutschland, says, “The good results, with significant increases in revenue and profit, show that our strategy of expansion in Germany is on the right track.”
First Industrial Realty Trust: U.S. industrial REIT expands in Germany
The exchange listed, U.S. REIT, First Industrial Realty Trust, specializing in commercial and industrial properties, has opened a branch office in Düsseldorf. The new office director is Oliver Drecker, previously the manager of marketing, leasing and asset management with SEGRO. Johannson Yap, the chief investment officer, stated that “First Industrial will target investments in the Rhine/Ruhr area, as well as Hamburg and Bremen.” The investments are to be made not only for the firm’s own balance sheet, but also for the FirstCal Europe fund, a $475mn joint venture between First Industrial and the California State Teachers’ Retirement System (CalSTRS), the second largest public pension fund in the U.S. with a portfolio of $170bn. The REIT sees opportunities particularly in sale-and-lease-back transactions with owner-occupied properties.
Berlin: Construction imminent for town villas in Tiergarten district
Commencement of construction is imminent for the town house project on the Diplomatenpark area in Berlin's Tiergarten district. The Berlin-based project developer Klaus Groth and his partners Reggeborgh and Kondor Wessels want to develop six of a total of ten houses on a plot measuring some 24,000 sqm. The owner of the premises between Hiroshimastrasse, Tiergartenstrasse and Köbisstrasse is Liegenschaftsfonds Berlin.