Germany has sex appeal – the real estate market is considered a stable and safe investment. International investors are impressed by Germany’s economic parameters. The country benefits from its status as a positive exception among European markets.
Deutsche Hypothekenbank (Deutsche Hypo) estimates that the transaction volume on the commercial real estate market in Germany will rise to approximately 25 billion Euros in 2011. This prediction is corroborated by the latest market figures. During the first semester of 2011 alone, sales in Germany amounted to nearly 12 billion Euros, which equals a year-on-year increase by more than 20 percent. Key drivers were once again retail investments, though a few isolated large-scale office transactions indicate that the office segment is about to revive.
Investors from inside and outside Germany are on the move, while institutional investors and family offices have intensified their search for real estate portfolios. During H1 2011, international investors accounted for about one third of the entire transaction volume on the German real estate markets. In addition to the institutional investors, family offices in particular have stepped up their activities. BulwienGesa AG counted more than 40 major transactions in this group of buyers during H1 2011.
High-Potential Locations Moving into the Investor Focus
Commented Ingo Hartlief, CEO of CORPUS SIREO Asset Management GmbH: “The growing transaction market is now expanding to alternative locations of high potential. With core real estate growing scarce in the Class A metropolises, stable regional markets in Germany are moving into focus for investors.” Especially office markets continue to offer amply potential here. Major German cities such as Essen, Dortmund, Karlsruhe, Aachen, Wiesbaden or Bonn are characterised by low vacancy rates, stable rent revenues, and faster rent hikes than Class A locations, as the latest empirica survey commissioned by CORPUS SIREO shows. While the office markets in metropolises such as Düsseldorf or Frankfurt am Main are subject to the general fluctuations of the economy, office markets in said high-potential locations are not as closely synchronised with the economic trend. This is to some extent explained by the frequently regionally oriented tenant target group, but also by the lower number of players on the local real estate markets.
Office buildings are handled like commodities in metropolitan top locations, whereas letting, building and relocating activities in regional locations are more purpose-oriented. The difference in rent brackets suggests as much: At the majority of properties in high-potential locations, rent rates range from five to ten Euros per square metres, according to the empirica survey for CORPUS SIREO. By contrast, rents in the top segment of Class A locations are often triple the amount charged on a more affordable level.
Germany Specialist Serving International Investors
CORPUS SIREO will coach international players from the moment they enter the German market. To this end, the company will commit its long-term experience as “Germany specialist” for international investors like Morgan Stanley, Citigroup or Brookfield to the Investment Management business area. It supports international professional investors in designing investment vehicles, in making decisions, and in acquiring suitable properties. The division contact for international investors is the experienced British real estate expert Douglas Edwards.
ABOUT CORPUS SIREO
CORPUS SIREO, based in Cologne, has 14.5 million square meters in commercial and residential real estate with an aggregate value of more than 15 billion Euros under management, and is thus Germany’s biggest provider of asset management services.
The company with a staff of around 560 professionals at ten locations in Germany and Luxembourg is also the market leader in regard to the number of managed asset classes: Serving seven asset classes (office, residential, retail, logistics, healthcare, production/technology, others), CORPUS SIREO offers the broadest spectrum of all German asset managers.
Accordingly, even rival companies rate CORPUS SIREO as the chief competitor on the market. (These are the findings of the “Real Estate Asset Management Report 2011" by Bell Management Consultants.)
To investors, banks, and companies with proprietary real estate portfolios, CORPUS SIREO offers investment management and asset management services along the entire real estate supply chain. Moreover, the company acts as broker and project developer for owner-occupiers and investors.
For more details go to: www.corpussireo.com
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