Garbe, Isaria join Domicil in preparing for IPO launch

A number of German real estate companies would appear to be gearing up for their launch as public companies, probably in autumn but certainly before the end of the year.

We reported in last month’s issue about the plans for an IPO by Munich-based Domicil Group, who have recently hired industry veteran Matthias Moser to help lay the groundwork for the listing. The latest companies to announce IPO plans are logistics property group Garbe Industrial Real Estate and residential property group Isaria.

The Hamburg-headquartered Garbe, which develops logistics facilities, warehouses and business parks in Germany and the Netherlands, has already engaged Deutsche Bank and JP Morgan to prepare its launch. It is expecting to sell shares worth €300-400m in a deal that should value it at about €700m.

The market for logistics properties continues to be buoyant, with logistics rents rising across Europe by 2.3% in 2018, according to Cushman & Wakefield. Broker Savills said in a recent not that the share of logistics in European investment activity has risen to 14% of the total and is expected to grow even further this year.

Meanwhile, specialist turnaround private equity group Lone Star is prepping the Munich-based residential property developer Isaria either for a sale or a stock market listing in the autumn.

Lone Star is working with VictoriaPartners as its adviser on the Isaria sale, and is aiming for a valuation of about €500m for Isaria. It bought the company in 2016 at a valuation of €107m, and delisted it from the stock market, subsequently injecting a further €53m in a capital hike.

Isaria last year reported earnings before interest, tax, depreciation and amortization of 39 million euros on sales of 142 million. The company is targeting sales of 700-800 million euros within the next five years, with the help of acquisitions, it said in its annual report. The company is now led by CEO Peter Finkbeiner, previously financial director at TLG Immobilien and before that at Lone Star subsidiary Hudson Advisers.

The expected combined sales price of Isaria’s property development pipeline currently stands more than 2.7 billion euros. It employs about 100 staff and is one of the largest residential property developers in Munich, where price increases have been among the steepest in Germany’s recent property boom.