18
GERMANY
ISSUE
COVER STORY
investors were also heavily represented in
the purchases of residential properties.
Morgan Stanley Real Estate Investment,
subsidiary of US investment bankMorgan
Stanley, won the deal for a comprehensive
portfolio comprising 17,000 units (selling
price: approx. EUR 1.2 billion).
According to property consultant Sav-
ills, the largest group of investors in com-
mercial properties last year was the Amer-
icans with a purchase volume of EUR 6.6
billion, ahead of the French (EUR 3.6
billion) and the British (EUR 2.7 billion),
not least because of the afore-mentioned
mega deal. Moreover, Asian institutional
real estate investors, such as pension funds
and insurance companies, are becoming
increasingly active in the German real es-
tate market. The fact that major interest of
foreign investors in German commercial
Y
ear 2016 was another great year for the
German real estate sector. Although
only a few records were set compared
to the previous year, for example logistics
properties, at EUR 66.2 billion (commer-
cial plus residential properties) (2015:
EUR 76 billion) the level of investments
remained fairly high.
Yet the outlook for the first half of the
year was not nearly as bright. Britain’s
referendum on remaining in the Euro-
pean Union (EU) also put the brakes on
investment activity in Germany. “Due to
the political parameters, domestic and for-
eign investors are paying evenmore atten-
tion to product quality, secure cash flows
and the economic stability of the target
market,” observes Fabian Klein, Head of
Investment of real estate service provider
CBRE in Germany.
Unwavering Euphoria: Investors
are Banking on “Merkel Country”
Real estate investments in Germany are still extremely popular among foreign investors. Last
year they accounted for nearly half of the volume of transactions. The trend in 2017 is still on
the rise. This group of investors is putting its money primarily in large real estate deals.
Photo: ECE
40 PERCENT OF INVESTORS FROM ABROAD
The investment business grew strongly in
the second half of the year. “With nearly
EUR 20 billion, the volume of investments
in commercial properties in Germany in
the fourth quarter of 2016 grew to the
highest level ever recorded for the final
quarter of a year,” says Klein. Over 40 per-
cent of real estate buyers are from abroad.
“They are to be found on the buyer side
particularly for big tickets, over EUR 250
million,” he adds.
The Blackstone investment company
from the US, more precisely its private
equity fund Blackstone Real Estate Part-
ners Europe IV, thus secured theOfficefirst
portfolio from IVG (book value: EUR 3.3
billion). “That was the largest commercial
property deal that had ever taken place in
Germany,” Klein says proudly. American
Real estate investors are still looking for office and
logistics properties as well as shopping centers.
