Oaktree selling €550m German commercial property

US private equity investor Oaktree has launched a new offensive to sell off large chunks of its German property holdings.

According to Boris Hardi, head of Oaktree Sabal Financial Germany, assets valued at about €550m are on the block. Sabal, based in Munich, is the servicing and asset management subsidiary for European investments of the American group.

The properties largely come from two main legacy portfolios. The first, named Project Adelaide, consists of about 200 mainly German retail assets sold by the UK's Nationwide Building Society two years ago to Oaktree for about €675m.

Nationwide had originally borrowed about €800m against the portfolio., which includes about three dozen supermarkets, neighbourhood malls ("Fachmarktzentren"), DIY stores, several REAL hypermarkets and a number of logistics centres. About €150m of the Adelaide portfolio is now for sale.

The second is a financing portfolio which Oaktree bought last year from Hypothekenbank Frankfurt, the rump bank of one-time powerhouse Eurohypo. Commerzbank, which bought Eurohypo, has been selling off the performing and non-performing property loans inherited from Eurohypo, in this case with a nominal value of €700m. The Oaktree portfolio for sale, valued at €400m, consists of offices, hotels, retail properties, land and a separate residential portfolio.

In total the Oaktree sales encompass 30 separate assets valued at between €8m and €50m each. Hardi said in a statement he expects the bulk of the sales to be completed by the middle of next year.

Separately, Oaktree said it had reduced its stake in German listed Alstria Office REIT by placing 10.72m shares, or a 7% stake, with institutional investors. The placement, handled by JP Morgan, was at a price of 12.20, a discount to the current price of about €12.65. The placement sees Oaktree's stake fall to 4.9%.