GERMANY – A consortium of insurers, pension funds and savings banks led by investment manager Patrizia has acquired the €2.5bn portfolio of GBW, the listed housing subsidiary of regional bank Bayern LB.
The transaction is one of the largest in Germany in recent years comprising 32,000 flats solely in the German province of Bavaria, bringing the total assets under management of Patrizia up to €10bn.
Matthias Moser, head of alternative investments at Patrizia, said "the portfolio is absolutely core with low vacancy rate and little tenant fluctuation”.
Patrizia will manage the new portfolio and GBW will remain an independent unit within the Patrizia group, retaining its name – unlike LBBW which Patrizia had to rename after acquiring it last year.
Bayern LB had to sell its stake in GBW as part of a deal pertaining to a financial aid package the bank had received from the EU in the wake of the financial crisis. The buyer had to sign a social charter ensuring the portfolio would not be split up and rental agreements would stay in place.
Patrizia will be buying Bayern LB’s 91.93% stake in the GBW as well as just over 4% from third parties, according to Moser. This provides Patrizia the necessary 96% interest to take over the company, which will take place shortly after the GBW’s general meeting on 15 May.
“Our investors want full control of the portfolio and this is not possible in a listed company,” Moser said.
The consortium consists of 27 institutional investors, all of them from Germany except for one Swiss Pensionskasse. They include 14 Versorgungswerke, of which one was named as Versorgungswerk for Apotheker in Westfalen-Lippe, eight insurers, three savings banks (Sparkassen) and one other Pensionskasse.
Patrizia noted that nine of the 13 partners in the consortium behind the LBBW purchase had invested again in the GBW portfolio. Patrizia itself has co-invested €58m.
Klaus Schmitt, COO at Patrizia, said there was "major interest" from international institutional investors, but he said the company decided to go with German-speaking investors only as the group had aligned interests.
He added the GBW purchase proved to investors that the LBBW transaction was not a one-off deal and Patrizia was capable of closing more than one deal of that size.
Wolfgang Egger, founder and CEO of Patrizia, confirmed there were currently no comparable portfolios in the market in Germany, either by size or quality.
However, Moser noted the GBW portfolio would not be split up and would be "actively managed" and extended adding further properties over time.
This could include acquisitions outside Germany and Moser said he saw potential in the Netherlands where he confirmed Patrizia was currently looking into two commercial property transactions at a combined value of €1.2bn.