News from 07/18/2008
Frankfurt: “Zeilgalerie” changes hands for €59mn
IFM Immobilien AG has acquired the Frankfurt shopping center “Zeilgalerie” from Signature Capital. The transaction took place indirectly through the sale of 94.8% of its holding project company. The seller is retaining the 5.2% minority interest. According to IFM, the total sum of the investment, including a planned €8mn revitalization, will run to more than €59mn. The completion of the transaction is expected in the middle of August, 2008. The shopping center was built in 1992 and has a total floor space of approximately 12,400 sqm for 43 commercial tenants. IFM reported that the occupancy rate is 95%, providing a current rental yield of more than 6%.
Secur GmbH: First mutual fund invests in retail and secondary markets
The fund initiator Secur GmbH, Wiesbaden, is putting its first closed real estate fund for private investors on the market. The fund, ISI – 8. Investitions- und Beteiligungsgesellschaft, will assemble a portfolio composed of secondary market investments and direct investments focused on retail properties at locations with above-average purchasing power. The secondary market portions will mainly be acquired at the Fondsbörse Deutschland, or German Fund Exchange. According to the initiator, the Secur fund differs from other secondary market funds in that it targets a majority share in the fund companies acquired. The aim is to change the management teams, manage the properties, attain higher rental income through new rentals and then sell the objects at a profit. The fund’s total investment volume amounts to €71.8mn with €50mn to be raised as equity. Secur is predicting initial distributions of 6% annually, growing to 12% a year.
Immac: Nursing home fund Lower Saxony is being placed
The Hamburg-based issuer of funds Immac is currently placing another closed nursing home fund. Immac Pflegezentren Niedersachsen Renditefonds GmbH & Co. KG is investing a total of nearly €22.7mn in two nursing homes in Peine (Lower Saxony). The equity portion is to be more than €10mn. According to Immac, the two nursing centers with a total of some 200 beds are leased to their operators for 25 years. The larger of the two has 150 beds and was built in 1993; the interior of the second, with 50 beds, was renovated in 2005. Immac is forecasting the fund’s distributions at 6% annually during the first few years, rising to 11.5% a year. A share in the fund projected to run until 2033 is possible starting at €20,000, plus agio. In May of this year, Immac started marketing Immac Pflegezentren am Rhein Renditefonds GmbH & Co. KG fund, which is investing a total of approximately €19mn (some €9mn in equity) in two nursing homes in Rheinbrohl (Rhineland-Palatinate) and Kehl (Baden-Württemberg).
Market development: Concentration of brokerages in Germany on the rise
In the past, mainly internationally oriented partnerships and auditors were hit by powerful waves of concentration in Germany, but now this trend is spreading to consulting and brokerage companies in the property branch. The appetites of internationally successful property groups are whetted. Helge Strobel, CEO of Comfort Holding, said, “Seen from the perspective of those effecting the takeovers, this is not surprising.” The firms, he continued, are following their customers and are buying not only know-how for the German market, but also the swiftness and flexibility necessary for keeping pace with experienced local companies. The integration of acquired enterprises, offices, or individual staff members is seldom as problem-free, however, as hoped. The process confronts everyone concerned with a demanding management task that cannot always be satisfactorily solved.
Real I.S.: Office object in Sydney acquired for €64mn
Real I.S. AG has acquired an office building in Sydney for a converted sum of approximately €64.03mn, the daily newspaper The Australian reported. The sellers of the object in “Homebush Park” in the western part of the city are two funds belonging to the Australian investment company Colonial First State (CFS). The property is said to be used by the Commonwealth Bank.
Axa REIM: First object in London acquired for Axa Immosolutions
For its open-ended property fund Axa Immosolutions, Axa Real Estate Investment Management (Axa REIM) has invested in London for the first time. They have acquired the “Sovereign House” office building in the Docklands, completed in 2003 with approximately 6,700 sqm of lettable area and 37 parking spaces. The building is leased to a data communication firm until 2026. Axa fund manager Daniel Fahrer said, “The current market reactions to the subprime crisis offer good investment opportunities in London. We assume that the London property market is going to develop positively in the future, leading to improved buying and selling possibilities.”
DIC Asset AG: 105,000 sqm rented out in first half of the year
Anticipating its business report for the first half of 2008, DIC Asset AG announced that it rented out some 105,000 sqm in the first half of the year. During the past few weeks, it has also successfully placed five commercial properties through individual transactions, mainly to private investors, at a total volume of approximately €22mn. The objects are located in Frankfurt, Hamburg, Cologne and Nuremberg. At the same time, shares in the Frankfurt “MainTor” project have been syndicated and, together with the investor Deutsche Immobilien Chancen further financial partners were taken on for the project. With that step, the first part of the project can now be realized. Commencement of construction on the new urban quarter is scheduled for early in 2009. DIC Asset intends to specify further details while presenting its figures for the first half of the year in August.