Cerberus engages UBS to sell off German retail assets

Private equity group Cerberus has hired UBS to find a buyer for its German cash & carry markets after abandoning its original plan to list its retail division through an IPO. The assets, many of which are wholesale markets leased to Metro, are thought to be worth up to €1bn.

Buyers such as retail funds from Europe and Asia are thought likely to be the prime targets for the sale. To date the assets have been managed by third party retail asset manager Acrest.

Cerberus has been actively investing in Germany since 2002, in both retail and residential. In 2012 the group bought the 300,000 sqm Rebound portfolio of 47 retail and mixed-use properties from FMS Wertmanagement, the winding-up bank of Hypo Real Estate, and has been redeveloping them, while in 2011 it bought 900,000 sqm of Metro Cash & Carry wholesale-retail properties located in urban centres throughout Germany.

Meanwhile, in sub-performing and non-performing loans Cerberus Capital Management has again emerged as the biggest buyer of loan sales in Europe, according to a recent report by Cushman & Wakefield.

Cerberus accounted for €5.6bn of sales over the period, or 24% of all closed sales in H1 2015 after completing the Capital Homes Loans deal valued at €3.5bn.

Cerberus was also the biggest investor in European non-performing loans last year, according to Cushman & Wakefield. Cerberus affiliates invested around €17.7bn in European NPLs in 2014, buying up about 20 European portfolios and accounting for 22% of all closed commercial real estate and real estate-owned transactions.

They were followed by the Deutsche Bank and Apollo partnership in second place at €3.2bn following their Permanent TSB purchases earlier in the year. Meanwhile Lone Star has climbed to third place after its purchase of the Project Parrot NPLs. In total Lone Star invested €1.6bn in loan sales over the period.

US firms continue to dominate the list of the top 10 investors. JP Morgan ranks fourth with €1.4bn, followed by Oaktree Capital (€1.3bn), Fortress/Eurocastle (€1.2bn), Sankaty (€1bn), Blackstone (€950m), and Goldman Sachs (€754m). The Hamburg-based family enterprise - Otto Group - ranked 10th with €650m.