Universal, GPEP buy further German retail portfolio

Frankfurt-based fund manager Universal Investment has teamed up again with retail specialist and portfolio manager GPEP to buy another retail portfolio, bringing the total investment of the two in German retail centres and retail parks to more than €210m since the beginning of 2015.

The latest acquisition, from an unnamed international special servicer, totals 108,000 sqm across 63 properties located across Germany, mainly in northern Bavaria, southern Saxony and North Rhine-Westphalia. The assets were in international portfolios, insolvencies and foreclosure sales, and generate rental income of about €7m. About half of the income comes from food retailers such as EDEKA, including discounters Aldi and Lidl, while the remaining mixed-use areas are in textiles, household goods, DIY and automotive. The average remaining lease term on the properties is three and a half years.

Although the majority of the properties require renovation, the locations are very good, the buyers said. "These types of opportunistic retail centres and retail parks are the ideal value and return driver in a largely conservative portfolio. This hinges on access to these opportunities as well as many years of experience in terms of assessing locations and developing this particular asset class," said Marcel Fuhr, managing director of GPEP, responsible for acquisition as well as asset and property management.