European real estate investment manager ActivumSG has taken a majority stake in German serviced apartment real estate platform Centralis.
As part of the deal, the founders of Centralis will assume co-CEO roles in the business and retain a significant minority shareholding.
Founded in 2020, Centralis specialises in the acquisition, refurbishment and development of serviced apartments and other hospitality-like assets in prime urban locations in Germany’s top seven cities and additional secondary markets.
ActivumSG said the acquisition also includes nine assets totaling 550 keys and 23,000sqm of net lettable area, all of which are pre-let. The portfolio includes four completed properties in Berlin, Bonn and Lübeck, alongside five projects in Hamburg, Dusseldorf, Cologne, Bonn and Nuremberg that are predominantly primed for value-add refurbishment.
ActivumSG said that, together with Centralis, it has a number of assets under exclusivity in expects to double the size of the portfolio by the end of 2025, adding that it also intends to provide growth capital to help scale the business into a €500m-plus gross asset value platform in the medium term, as plans for a European expansion are already underway.
Saul Goldstein, founder and CEO, ActivumSG, said: “This transaction underscores our strong conviction in the European accommodation sector, with serviced apartments sitting at the intersection of hospitality and living real estate. These are two high-growth asset classes in which we have considerable expertise and are an ongoing strategic focus for our client partners.
“With traditional staff-heavy hospitality operating models under pressure from rising costs and labour shortages, the tech-enabled, people-light serviced apartment model offers the prospect of premium profit margins alongside a reliable user experience that appeals to a diverse range of customers. However, there remains a lack of high-quality investable opportunities in this attractive sub-sector – a gap in the market which we will look to address through this acquisition.”
Johannes Vielberth, director, corporate transactions at ActivumSG, said: “In Centralis, we are acquiring a platform with a seasoned team, a proven track record, a high-quality seed portfolio, and an exclusive pipeline. We look forward to working with Fabian, Lukas and their team to build on this attractive entry point and capitalise on our early mover advantage to build an industry leading platform, eventually expanding its geographic focus beyond Germany.
“The opportunity with Centralis allows us to build on our 18-year heritage of investing in Germany. ActivumSG’s investment and expertise will enable Centralis to scale its asset base, providing the real estate infrastructure to modern hospitality operations in a growing sector backed by multiple tailwinds. Through our value-add approach, we can generate attractive yields on cost relative to market yields as well as substantial stabilised cash-on-cash potential.”
Fabian Vieregge and Lukas von Lüdinghausen, co-CEOs, Centralis, said: “ActivumSG has an excellent track record investing in hospitality and residential real estate across Europe and partnering with existing management teams to drive enterprise and asset value, with a well-established local presence in our home market Germany.
“The German serviced apartment market has seen steady growth over the last few years, while being still highly diverse and fragmented, creating opportunity for well-capitalised market players like us to acquire, convert and aggregate stock into a scaled, institutional-quality portfolio.”
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