Deutsche Asset & Wealth Management (DeAWM) has teamed up with minority investor ECE to purchase the PalaisQuartier site in Frankfurt for around €800 mln.

Deutsche Asset & Wealth Management (DeAWM) has teamed up with minority investor ECE to purchase the PalaisQuartier site in Frankfurt for around €800 mln.

DeAWM is taking a 90% share in the deal while Hamburg-based ECE has invested 10% in the transaction and will assume management of the adjacent MyZeil shopping mall which forms part of the complex.

The vendor is KP Investments, part of Rabo Real Estate Group.

The purchase price of around €800 mln makes the transaction one of the largest in Europe for 2014. CBRE advised the buyers' joint venture in the transaction, while JLL acted for the vendor.

Landesbank Baden-Württemberg (LBBW) is providing finance for the deal as the sole lender.

The parties agreed not to disclose the loan amount, saying only that it is ‘within the range typical of such finance’. There are no plans to syndicate the loan.

The vacant land known as the Rundschau Site, also part of the property, has been sold to Strabag Real Estate for development.

The PalaisQuartier, located in the centre of Frankfurt, offers some 115,000 m2 of rental space and consists of five separate buildings: the 33,800 m2 Nextower office tower; the Jumeirah Frankfurt hotel tower offering 26,300 m2; the reconstructed Thurn und Taxis Palace comprising 6,300 m2; the MyZeil shopping mall with 43,800 m2 as well as an underground car park facility with almost 1,400 spaces.

The PalaisQuartier has won numerous awards including DGNB Gold for Office Building Sustainability. During 2013, MyZeil had footfall of around 15 million visitors, making it one of the most frequented shopping centres in Germany. The Nextower currently has a 36% occupancy rate.

'The PalaisQuartier is a unique investment opportunity for us and our fund investors. It offers a diverse combination of first-class hotel, a popular, established shopping mall, an exclusive event venue as well as high quality office space right in the centre of Frankfurt, with unparalleled skyline views,' commented Jörn Stobbe, head of transactions and asset management for Germany, Austria & Switzerland at DeAWM. 'ECE is a renowned partner to manage the shopping mall and Strabag is an experienced developer to take on the vacant lot.'

Alexander Otto, CEO of ECE Projektmanagement, said: 'We have taken a stake in this rare investment opportunity because we believe there is outstanding scope to enhance this Quarter in conjunction with our partners and to further optimise the already well-run MyZeil.'

KP Investments was mandated by Rabo Real Estate Group in 2011 to manage a portfolio of the three largest assets of the group. KP Investments took ownership of the PalaisQuartier asset with the aim of finishing the development and selling the asset. 'This transaction marks the successful conclusion of our overall assignment for the Rabo Real Estate Group,' said Otto van den Boogaard, managing director of KP Investments.

Deutsche Bank's investment division and ECE have been rumoured to be in exclusive negotiations with Rabobank of the Netherlands since June.

Rabobank is said to have initially sought €1 bn for the scheme.