News from 10/16/2008
KanAm Grundinvest: Fund cancels acquisition of office tower in Frankfurt
The open-end fund KanAm Grundinvest is not going to acquire the “Opernturm” office project in Frankfurt after all. The deadline for the option to buy the approximately 67,000 sqm of usable area in the 168 m tall building at the Rothschildpark ran out on Tuesday. In an interview with THOMAS DAILY, a company spokesperson explained the decision: “The further insecure development of the banking and financial sector in the wake of the financial crisis led the managers of the fund to prefer security to taking chances.” Up to this point, only around 50% of the project, which is slated for completion in 2010, has been rented out. The principle tenant is the banking giant UBS, which also owns half of the building. The other owner is U.S. developer Tishman Speyer. KanAm thus feels that the risk involved in the current tenant structure is too great. Instead of the Opernturm, the fund is now acquiring the Citydel Business Center office building in Moscow which, it says, is rented long-term to such credit worthy, non-banking sector tenants as Regus and Japan Tobacco International.
Investment market: JLL calculates transaction volume of €16bn
According to Jones Lang LaSalle (JLL), the transaction volume on the German investment market for commercial properties during the third quarter reached about €4bn, thereby not matching the level of the second quarter. During the first three quarters, the total volume dropped to almost €16bn. The volume is thus about 60% below the results for 2006 and 2007, the report says. For the entire year of 2008, JLL predicted a transaction volume of €20bn to €23bn. The sharpest slump during the current year was recorded in Frankfurt (-82%), followed by Hamburg (-70%) and Düsseldorf (-65%). Comparatively moderate setbacks were registered in Berlin (-38%) and Munich (-36%). Prime yields for office properties, the report continues, rose in all six strongholds during the past three months by more than 25 basis points to 5.16%, while the twelve-month comparison increased by nearly 60 basis points.
Munich: Cornerstone laid for “Agfa Park” commercial buildings
The cornerstone for the commercial buildings belonging to the large-scale project called “Agfa Park” in the Obergiesing district of Munich will be laid today. The developer Büschl Unternehmensgruppe builds several office buildings with approximately 40,000 sqm of gross floor area on the former Agfa premises. The character of the project is to be defined by a 60 m tall office tower. In order to make room for the new building, the 1950s era Agfa high-rise was blown up in February. Completion of the office complex is scheduled for the middle of 2010. Construction of a projected residential quarter is to commence on the area during the coming year. By 2012, some 1,100 two- to four-room apartments totaling up to 105,000 sqm of floor area are to be built. The total investment amounts to around €300mn.
Office market: Take-up in top 6 locations sinks by 4.5%
The take-up of office space in the six largest German office strongholds – Berlin, Düsseldorf, Frankfurt, Hamburg, Munich and Stuttgart – is stagnating. According to a study compiled by Colliers PropertyPartners, approximately 2.25mn sqm of office space were taken during the first nine months of the year – a reduction of some 4.5% compared to the third quarter of 2007. The slackening economic performance is gradually making itself noticed, even considering a north-south divide, the Colliers report says. The market with the greatest absolute demand was still Munich (601,900 sqm, +1.2%), but the greatest percentage increase was in Stuttgart (147,000 sqm, +14.8%). The office markets in Hamburg (-2.1%), Frankfurt (-9.0%) and Berlin (-8.1%) had similar take-ups ranging from 410,400 to 418,600 sqm. Düsseldorf showed movements of only 254,000 sqm (-15.3%) by the end of the third quarter. Clearly, higher levels of office space take-up for the entire year, compared to the year before, is to be expected only in Stuttgart, thanks to the level already attained and to inquiries already submitted, the report states. The brokerage house concluded that “For Berlin, Munich and Hamburg, we are anticipating steady to only slightly lower volume compared to 2007. In Düsseldorf and particularly in the financial center Frankfurt, the setbacks will be much more significant.”
Hamburg: 55,000 sqm logistics hall planned at airport
On a parking lot just south of the Hamburg airport, a new 55,000 sqm transshipment hall for air freight is planned for development, as Michael Eggenschwiler, airport business manager, told the branch newswire “Logistik Inside.” The project, to be developed during the coming three years, is to replace the existing freight facilities. Eggenschwiler commented that there are further plans to develop new passenger terminal and retail buildings on the current freight handling area.
Berlin: Commerz Real acquires office project
Commerz Real has acquired the”Westend IV” office project in Berlin for its special fund ProCommerz. It announced that the pertinent sales contract has been signed with the seller, Conex Invest GmbH. After its completion slated for June, 2010, the property will provide 5,500 sqm. The investment volume is quoted by Commerz Real at approximately €14mn. According to the firm's statement, the new property is next to an office building in Charlottenburg which is also in the ProCommerz special fund portfolio.