Global investment firm KKR has added €1bn worth of residential and commercial assets to its German real estate portfolio.
KKR, via its Real Estate Partners Europe II fund and other KKR managed funds, has agreed to buy the 14,000 units of mostly residential units from Adler.
Adler said the agreed purchase price corresponds to a valuation of the portfolio of €1.05bn.
The properties will be managed by Velero, KKR’s portfolio company. Velero will also take on all 170 Adler employees performing operational and other asset-related tasks in relation to the acquired portfolio.
The deal lifts Velero’s managed portfolio to more than 23,000 residential real estate units, making it one of the largest privately-held real estate companies – by number of managed residential units – in the German
The acquired units are located in Cottbus, Leipzig, Halle, Erfurt, Jena, Dresden and Chemnitz, as well as other cities in eastern Germany, the greater Berlin area and North Rhine-Westphalia, KKR said.
Jan Baumgart, managing director and head of real estate Germany at KKR, said: “The acquisition of this portfolio is a testament to our ability to execute on highly attractive opportunities in the German residential real estate market.
“We look forward to working with Velero to enhance the quality of living, improve the energy efficiency, reduce vacancy and drive operational improvements. We will invest substantially into the properties to achieve these objectives.”
Sascha Giest and Thomas Lange, co-CEOs and founders of Velero, said: “This transaction marks a milestone in the growth journey of Velero. The acquired units make for a valuable addition to our existing portfolio of managed properties and our location strategy.
”The acquisition of the portfolio will enable us to leverage economies of scale in property management – all while ensuring a smooth transition and high-quality services to our tenants.”
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