Savills IM buys further €75m assets for German fund

Savills Investment Management has bought a retail centre in Germany and an office building in Luxembourg for a combined total of €75 million, on behalf of a southern German pension fund. The two assets were sold by German mutual fund SEB ImmoInvest and a UK investment manager.

The recently-renovated 10,000-sqm retail park in Bielefeld, Germany, is let to tenants including supermarket Edeka and electronics shop Media Markt.

In addition, the fund acquired a 6,400-square metre office space, the Espace Kennedy in Kirchberg, Luxemburg, which comes with 134 underground parking spaces. It is currently under long-term lease to six well known companies, including Accenture, Cisco and TD Bank.

Savills IM is planning to focus its acquisition activities on core/core+ office and retail assets and “will particularly be looking to Germany, but will also be placing greater emphasis on southern European countries and the Netherlands”, according to head of fund management at Savills IM, Gerhard Lehner. “Compared to most European office markets, the vacancy rate on the Luxembourg office market is quite low, giving us potential for above-average rental growth", he said.

“We are pleased to have acquired this asset for our client within the scope of a bidding process, in part due to the fact that yields at purchase there are still relatively low, particularly compared to core German markets. With its long-term leasing situation, the retail centre in Bielefeld will help guarantee stable distribution for the portfolio, which we have been building for the pension fund since 2015”, he said.