Commerz Real has snapped up Viridium Gruppe’s €2.5bn Milennium portfolio for its open-ended Hausinvest fund, marking the biggest deal in the company’s history.
The mixed-use portfolio comprises 48 properties across 352,000 sqm, including 26 offices, 14 residential properties and nine retail premises in inner-city locations in Berlin, Düsseldorf, Frankfurt, Hamburg, Cologne, Munich and Stuttgart, as well as in Giessen, Leipzig and Unterhaching. The properties are typically between 5,000 sqm and 10,000 sqm in size, with the majority – around 61% - built or modernised after the year 2000. The occupancy rate across all the properties is around 93%.The rental income is expected to be in the region of €75m per year, someone familiar with the deal told REFIRE.
‘Ultimately we were able to assert our bid in a very competitive process,’ said Henning Koch, global head of transactions at Commerz Real. ‘The portfolio is perfectly geared to our investment strategy of increasing the share of German properties in the fund and in doing so achieving the best-possible mix of all usage types.’
For fund manager, Mario Schüttauf, the acquisition ‘will stabilize Hausinvest’s yield’: ‘The objective is, above all, to hold on to the more than 1,000 apartments in the long term,’ he said. ‘We intend to reassure the tenants, and also the municipal authorities and local councils, and give them the necessary security that there will not now be measures to maximise the short-term profitability.’
Following this deal, Commerz Real is moving significantly closer to its goal of investing around €2bn in the residential sector in the next four years. The Millennium portfolio formerly belonged to Generali Lebensversicherung but the majority interest was held by Viridium Gruppe, a specialist in the efficient management of life insurance portfolios in Germany.
Commerz Real was supported by the management consultancies CMS Hasche Sigle (legal), Arcadis (technology) and KPMG (tax), as well as by Wertgrund Immobilien AG (residential). The seller was advised by Allen & Overy (legal). BNP Paribas Real Estate brokered the transaction.
