Swiss investor Corestate has scooped a German commercial and residential portfolio valued at 鈧�150 mln and agreed to buy an additional 鈧�150 mln of resi assets.
Swiss investor Corestate has scooped a German commercial and residential portfolio valued at 鈧�150 mln and agreed to buy an additional 鈧�150 mln of resi assets.
The first portfolio comprises 2,400 residential units in multi-family buildings in metropolitan areas of Northern Germany. It includes two core commercial assets totalling 22,000 m2 in central Berlin and Hamburg. The portfolio was acquired at a significant discount to the original loan amount.
The second portfolio comprises residential and commercial units and is spread across major cities in North-Rhine-Westphalia (NRW). The portfolio is currently in administration and in need of a complete recapitalisation.
The parties have agreed to keep the sales prices confidential.
'The outlook for the German residential market for 2013 indicates that our multi-family strategy leads to a sustained value creation in our investments,' said Ralph Winter, chairman and founder of Corestate Capital.
This is illustrated by the upcoming IPOs in the German residential market which show an increased interest by national and international capital for non-core residential real estate, he added.
Winter: 'Our specialised asset management team will now take the respective measures to reposition and stabilise these newly acquired portfolios as previously conducted many times in our various former acquisitions.'
The transaction is a sign of increasing appetite for higher risk properties. 'We expect the opportunistic portion to represent a larger share of the market in 2013, as investors move up the risk curve and vendors feel more comfortable about putting distressed properties onto the market,' commented Ignaz Trombello, newly-appointed head of capital markets Germany at Colliers Internation.
According to Trombello, the situation in the core space is expected to calm down, due to declining prime yields and lack of supply. 'The overall investment figure is, however, expected to remain similar to 2012 levels, as long as financing cost and interest rates remain low - and that is likely to be the case for at least another year,' he said.
