Hines in double whammy acquisition in Germany

A fund set up and managed by US investor-developer Hines has bought two properties in Germany, including the mixed-use Kö-Quartier complex in Düsseldorf.

The Kö-Quartier complex on Düsseldorf’s Königsallee was bought from US private equity firm Rockpoint Group. Market sources quoted by German trade publication Thomas Daily put the purchase price at around €210 mln.

In addition, Hines has acquired the mixed-used Kronprinzbau building in Stuttgart from Credit Suisse. Financial details were not disclosed.

Ken MacRae, managing director of the fund entities, said: ‘We are excited about the successful closing of the two acquisitions that, as a result of their investment profiles, provide for good diversification and a balanced investment with long-term value growth potentials.’

Kö-Quartier consists of seven buildings with more than 55,000 m2 of office and retail space, as well as around 420 parking spaces. Hines plans to upgrade five of the seven buildings over the next few years. In addition, the development of new office buildings on Breite Straße and Benrather Straße is due to be completed by 2017.

The existing buildings are leased on a long-term basis to tenants such as Deutsche Bank, Linklaters, Bank of Tokyo, and Lang & Schwarz Wertpapierhandelsbank.

Benjamin Biehl, director of Hines Immobilien, added: ‘Kö-Quartier offers the investors the possibility of cooperating with existing premium tenants and the rare opportunity of a new development in the best office location in Düsseldorf. In particular, after the development and sale of Benrather Karree in 2003 and the purchase of the Metropolitan in 2011, I am very happy to reopen the local office of Hines Immobilien GmbH in Düsseldorf.”

Kronprinzbau is a mixed-used building located in the immediate vicinity of the Königstraße shopping mile in Stuttgart which provides around 25,500 m2 of office and retail space, as well as a parking garage with around 266 parking spaces. All the office space is leased to regional bank LBBW on a long-term basis. Tenants in the retail section include Max Mara and René Lezard as well Feinkost Böhm.

Debt financing for Kö-Quartier and the associated development project will be provided by LBBW. BNP Paribas Real Estate and Eastdil Secured as well as Clifford Chance Germany advised Rockpoint on the sale.

Debt financing for the Kronprinzbau transaction was provided by ING. The sale was completed off-market.

On the buyer side, Pöllath + Partners, Clifford Chance Luxembourg, and PwC provided legal and tax advice for both acquisitions.

Since opening its German office in 1991, Hines has acquired or developed 28 properties representing around 1.3 million m2 for Hines or third parties.