Tishman re-buys landmark Berlin property for €335m

Tishman Speyer's commitment to Germany, and indeed Berlin, go back a long way. In the early 1990's the company partnered up with Sony Corp. to develop the Japanese electronics company's flagship European headquarters at Potsdamer Platz, before selling the 130,000 sqm property. It continued to develop a number of major office towers, mainly in Frankfurt, over the following years.

Another Berlin development in the early 1990's was the mixed use Quartier 205 ("The Q") which Tishman sold in 2007 for €275m to Spanish private bank Banif and Ponte Gadea, the investment vehicle of Spanish fashion magnate Amancio Ortega, the founder of the Zara chain.

Last month Tishman Speyer bought the property back after eight years for a price reported to be €335m in a share deal. Berlin Hyp provided the financing, and the deal was said to have been concluded within four weeks. The price represent a multiple of 21.5 times annual rental income

Designed by Oswald Mathias Ungers, the US firm originally developed and built the property following the fall of the Berlin Wall. It was completed in 1995 and comprises 52,500 m2 of office, retail and residential space, covering a full city block. The asset was previously called Quartier 205 before being rebranded as The Q in 2011. The Q encompasses 32,000 sq.m. office and 17,000 sq.m. retail space, located in the heart of the German capital between Friedrichstrasse and the Gendarmenmarkt. Its current occupancy rate is 90%, and major office and retail tenants include Coca Cola, Citigroup, AT Kearney, Gucci and H&M.

It had been known to be on the market for several months, with JLL and CBRE both involved in brokering a deal with suitable buyers. Several bidders had expressed an interest, but a report in trade journal Immobilien Zeitung suggested that the speed with which Tishman Speyer could conduct their own due diligence (four weeks) on the property gave them the edge in beating off the competition, although their bid was not actually the highest. In the end Tishman and the Spanish owners agreed on the deal in principal amongst themselves, said the journal.

The co-CEOs of Tishman Speyer, Jerry and Rob Speyer, said: "We are thrilled to once again be in ownership of Quartier 205, a building that we originally developed to serve as a dynamic mixed-use experience comprising working, living and shopping in the historical centre of Berlin. This acquisition also constitutes our re-engagement with the Berlin real estate market where we began over 25 years ago, and we look forward to widening our presence in this vital city in the years to come."

Tishman Speyer recently presented its designs for the 45-story mixed-use tower that it's developing on the former Metzler bank site at Grosse Gallusstrasse in Frankfurt for its newest European value-add fund. It currently has a German portfolio of just over 200,000 sqm.