Commerz Real's KVG arm has acquired an existing student residence with 244 units from the private business university Frankfurt School of Finance & Management and plans to demolish this building at the beginning of 2021 and develop a new residential building on the 12,300 m2 site.
Located in the city’s Nordend-West district, the project is planned to offer 1,133 furnished serviced and student apartments on a leasable area of 39,000 m2 by 2023.
Commerz Real said that the project is the largest of its kind in Germany and will require an investment of €226.5 mln. The group has entered into a joint venture with project developer and administrator i Live, which specialises in smart living concepts, to bring forward the property which will be added to two real estate funds, Commerz Real Institutional Smart Living Fund and Commerz Real Smart Living Europe Fund.
'With the new development we can support the city and Frankfurt School of Finance & Management in providing as much housing as possible to meet people’s needs,' explained Johannes Anschott, a member of the board of management of Commerz Real.
In total there are some 66,000 students in Frankfurt am Main, who make up about nine per cent of the city’s population. The number of students has risen sharply since 2010, by more than 20% at the Goethe University and by more than 85% at Frankfurt School of Finance & Management. At the same time the vacancy rate on the Frankfurt apartment market is less than 0.5%.
Upon completion the i Live Group will assume responsibility for the leasing and property management. Commerz Real already works together with the company on two student apartment complexes in Darmstadt and Essen.
'We are pleased that we are now commencing a third joint project with Commerz Real with the largest planned student and furnished serviced apartment project in Germany and that we are able to contribute our proven i Live operator concept,' added Amos Engelhardt, the managing partner of the i Live Group.
Commerz Real Institutional Smart Living Europe Fund is to develop a diversified portfolio of ten to 15 residential complexes in European university towns with a total volume of €500 mln. It is planned to attain a BVI return of 4.5% per annum.
