GERMANY – Commercial deal volume in Germany crossed the €30bn mark in 2013, making it the best year since the financial crisis, with major deals also reported in the non-core sector, CBRE has found.
According to the real estate service provider, more than €30.4bn was invested in 2013 in the German commercial sector, 21% higher compared with the year previous.
Fabian Klein, head of investment at CBRE, said: “The German investment market is booming, and the trust of national as well as international real estate investors is continuously growing thanks to the market’s stability and safety.”
He said it was the “best result in the investment market for commercial real estate in Germany since the beginning of the financial crisis”.
The company noted a “large number of big transactions” and a considerable increase in the core segment – and increasingly the non-core segment.
CBRE added there was “growing interest from investors from non-European countries, especially from Asia”.
However, according to a survey by the association of German real estate service providers, the IVD, the number of foreign investors participating in German deals remains low.
Less than 10% of all purchasing deals are closed with international buyers, the survey of 560 real estate agents found.
Compared with previous years, however, IVD noted an increase in demand from buyers in Russia, China and other countries from the Middle East.
The CBRE analysts point out that, in the commercial sector, the share of foreign investors has actually decreased year on year.
But they attribute this to the increased domestic bias of German investors rather than a lack of interest from foreign buyers.
The main German buyers in 2013 were open real estate funds and open Spezialfonds, while the latter have considerably increased the number of their purchases compared with 2012.
Lastly, Warburg-Henderson announced the first major transaction in 2014 for its KOOP fund, a club deal of four German municipal pension funds.
The Warburg-Henderson KAG für Immobilien bought a mixed office/retail object in 90 Queen Street in London with 6,400sqm.
The purchasing price equals a net initial rate of return of 5.4%.