Specialist German retail property investor Fim Group has acquired a portfolio of 27 retail properties in Germany from M7 Real Estate for €86.4 mln.
M7 said that it sold the assets on behalf of M7 Islay, its discretionary fund focusing on industrial, retail and office properties in Germany and the Netherlands.
The portfolio, which includes a mix of food anchored tenants, comprises a total rental area of 72,594 m2. The assets are 92% let to a range of occupiers including Lidl, Netto, Edeka, Rewe, Dänisches Bettenlager and Siemes Schuhcenter. The largest single asset, which is on Hildesheimer-Strasse in Hannover, comprises 10,710 m2 of space.
Having acquired the properties in separate transactions over 2015 to 2016 on behalf of the fund, M7 said it implemented an active management strategy involving capex projects. By securing new leases and restructuring existing leases, it increases the occupancy of the portfolio from 80% to 92% and extended the unexpired lease term to six years.
Alyssa Huse, managing director of M7 Real Estate in Germany, said: 'This sale is in line with our business plan and has delivered attractive returns for our investors.
'Leveraging our asset management expertise, we have improved the performance across the portfolio, attracting a diverse occupancy base to these well located assets and creating an attractive market proposition.'
M7 Islay is aimed at high net worth individuals, family offices and institutional investors, and has made investments totalling some €440 mln across its target markets, comprising a total of 453,000 m2 of lettable space.
'We see good potential for value enhancement in the portfolio, and we want to continue the path already taken by M7 by optimising individual properties,' said Jan Lerke, Fim's managing director responsible for real estate management.
'In this regard, we are holding talks with initial operators. The retail package is particularly interesting for us because of the individual locations in major cities such as Hanover or Saarbrücken,' Lerke added.
Luther Rechtsanwälte acted as M7’s legal advisor, with Zirngibl acting for Fim.
As well as taking over the portfolio's property and asset management, DIWG Deutsche Immobilien Wirtschafts carried out the commercial due diligence for Fim.
