Brokers battle for market share in German resi sector

Former Conwert head Jürgen Kelber is joining Dr. Lübke as a new partner in a move to expand the agency and tap into Germany´s booming residential market.

German estate agent Dr. Lübke is gearing up to do battle with established consultants in the sector including CBRE and Jones Lang LaSalle. 'We see very good potential to grab market share from our competitors,' Ulrich Jacke, co-owner of Dr. Lübke, told PropertyEU.

The Frankfurt-based property consultant is being renamed as Dr. Lübke & Kelber after taking Jürgen Kelber on board as a new managing partner. Ralf Kind is also joining the company. The incoming partners and the existing senior management - Morten Hahn and Ulrich Jacke - will hold equal interests in the company.

Until last year, Kelber headed Vienna-based property company Conwert, owner of 33,250 residential units in Austria and Germany. Kind previously worked as head of the real estate investment banking team at Barclays responsible for the real estate business in Germany, Austria, Switzerland and the Netherlands.

Kelber, Kind and George Salden, previously head of merger & acquisitions at Conwert, are also shareholders of newly formed Arbireo Capital AG, an investment advisor working closely with Dr. Lübke & Kelber. 'Setting up this company permits us to provide investment management competence in addition to asset management and transaction related services,' Kelber said.

Long history in German market
The estate agent, founded more than 45 years ago, currently employs 60 professionals in its six branches in Berlin, Frankfurt, Munich, Stuttgart and Dresden. Now the company wants to expand its business considerably by tapping more seriously into the ongoing boom on the German residential market. 'Looking forward, we see ourselves as one of Germany's leading three asset and investment managers,' Kelber said.

'We want to grow assets under management from €200 mln to €1 bn within the next two years', Jacke added. In order to achieve this goal, the company is seeking to expand its management services for foreign and national institutional investors active in residential real estate. 'We plan to grow the portion of net sales acquired in the residential sector from 60% to 75%,' Jacke said.

Dr. Lübke & Kelber is not only well connected and experienced in Germany's leading city markets, but also in the secondary markets, he added. 'What sets us apart from many competitors is the fact that we don't only know Berlin, Hamburg and Munich, but also the markets in small cities from Husum at the North Sea down to Berchtesgaden in the Alps.'

Since the turn of the millennium, international investors, among them Cerberus, Fortress, Terra Firma, and the Whitehall Funds of Goldman Sachs, have bought up more than two million apartments and residential units from cash-strapped public sector organisations, and have converted parts of those operations into listed companies like Deutsche Annington, Gagfah, GSW, and LEG by floating them on the market.

After the outbreak of the financial crisis in 2008 the market soared even higher with family offices and wealthy private investors turning to residential real estate in a move to find a safe haven for their money. As a result, transaction volume exploded to €11.25 bn in 2012, according to a study by CBRE. 'Last year, 84% more residential units changed hands than in 2011,' according to Konstantin Lüttger, head of residential investments at CBRE Germany.

CBRE has been active in the German residential market since 2003, offering evaluation and advisory service to investors with currently around 30 residential specialists. 'The segment and with it our residential unit has been growing year after year,' said Henrik Baumunk, Head of Residential Valuation at CBRE Germany.

Dr. Lübke & Kelber will not only have to vie with CBRE for clients, however. Jones Lang LaSalle has also already established itself as a consultant in the residential market, offering valuation services for the last 10 years and advisory services since 2008. And the German subsidiary of the Chicago-based international consultancy group is not willing to surrender market share without a fight.

Indeed, the opposite is true, said Frank Pörschke, CEO Germany at Jones Lang LaSalle. 'We want to get a bigger slice of the pie and plan to expand our residential valuation and advisory teams in the coming years.'

PropertyEU is hosting its nextGerman Investment Briefiing in London on 19 September.