German fund manager Commerz Real has been forced to select a new chief after the resignation of Gabriele Volz over cultural and professional differences.
‘This is a shame! I was looking forward to seeing her do very well’. So said the head of valuations at a European real estate company in reaction to news that Commerz Real’s new CEO, Gabriele Volz, had left the company after only three months in the job.
Kelly Woodman of Atrium European Real Estate was probably speaking for many when she expressed her feelings on social media. As one of very few female CEOs of a high-profile real estate firm, Volz’s departure has felt like an acute loss to diversity.
The dust has scarcely settled on news of her surprise removal on 16 April.
Ideal candidate
Volz, who previously spent over 10 years at Unicredit’s Wealthcap arm, was hired in June last year by the company and she began the role in January. At the time of her appointment, Commerz Real said she was a highly respected expert in investment and asset management who had the ‘ideal prerequisites’ for taking on the transformation of the company into a sustainable digital asset manager.
Michael Mandel, then the chairman of the supervisory board, said Volz had ‘an impressive track record, demonstrating she had the management qualities to successfully lead companies and forge their destiny’.
As well as having had a career at Bayerische Vereinsbank, Bethmann Vermögensbetreuungs, and HypoVereinsbank, she was a lecturer in real estate at Munich Technical University and in 2018 even won the Manager of the Year award at the German Real Estate Women Summit.
So, what went wrong?
The company says the decision to part ways was taken after a ‘difference of opinions’ over the company’s management and strategy.
Commerz Real, which manages €35 bn of ssets under management (AUM) and is owned by Germany’s Commerz Bank, declined to say any more. However, it is rumoured that key figures at Commerz Real had a different view on the type of new products to be launched that Volz was proposing. Once it was clear her proposal for smaller, more numerous funds failed to win support, she offered her resignation.
It cannot have helped that the person who first hired her – Mandel – himself left the group in September 2020 before Volz had begun in the CEO role, to be replaced by new chairwoman, Sabine Schmittroth.
Volz stayed on the company’s board until the end of April. ’I would say that the cultural and professional fit was not perfect,’ commented a person with knowledge of the situation. ‘I think it was the right decision to correct this sooner rather than later.’
In an official statement, Schmittroth said: ‘I deeply regret that Gabriele Volz has decided to seek a new professional challenge. I wish her all the very best and every success in the future.’
Volz’s departure would also have shrunk the group’s management board to only two members, Henning Koch and Dirk Schuster, while it has historically comprised at least three executives, if not four. As such, the fund manager announced in late April that Siegfried Eschen, a director within the parent company Commerbank and a real estate economist, will join the board from 1 June.
Safe bet
In tandem with Volz’s departure, Commerz Real announced that Henning Koch would take over as the new CEO, starting in May. Aged 43, he is seen as a good cultural fit and is certainly in tune with the rest of the team having been with the group for about four years. Initially responsible for all international real estate and sales activities as global head of transactions, he has been a member of the board of management of Commerz Real, with responsibility for transactions and asset management, since April 2020.
Prior to this he worked at Credit Suisse for more than 11 years where he was responsible for international transactions of real estate investment products as head of acquisition & sales Europe from 2013 onwards. Schmittroth is understood to have been behind Koch’s appointment, the third CEO at Commerz Real in less than 12 months.
‘In Henning Koch an experienced manager is assuming the position of CEO at Commerz Real, one who is thoroughly familiar with the company and its business environment,’ commented Schmittroth. ‘Henning Koch is a convincing choice thanks to his extensive specialist expertise and his pronounced management qualities.’
Previous Commerz Real CEO Johannes Anschott is also appreciative of his former colleague’s resourcefulness. ‘I enjoyed working with Henning,’ he said. ‘He is a team player, drives business and is a knowledgeable expert. I think he is a good choice to drive Commerz Real forward. I wish him and my former colleagues all success.’
Anschott, who was appointed interim CEO before Volz arrived, left the firm at the end of March and is now a management board member of German lender BayernLB with responsibility for corporate clients. Like Koch, Anschott came through Commerz Real’s management ranks, having been with the group for over four years at the time he stepped into the top position in June 2020.
Already familiar with the company’s culture and strategy, he was the successor to longtime CEO Andreas Muschter who took the helm of the group in January 2013 and remained in charge for over seven years. Muschter left last year to join European hotel specialist The Student Hotel Group in Amsterdam as chief financial officer, but has since moved on again and is currently the new property boss at Zech Group, a German family-owned construction business.
Bull run
During his tenure, Muschter helped transform the business into one of Germany’s largest international investment managers for real assets, and was instrumental in the €2 bn Millennium portfolio acquisition of 2019 – a record year for the group’s flagship Hausinvest fund which in total bought nearly €5 bn of assets and exchanged on some €7 bn of deals to reach a total volume of €16 bn.
The group was then riding on the crest of a wave. It completed the largest portfolio deal of the year, Millennium, acquired Munich office campus Tucherpark for €1.1 bn and bought a stake in 10 Kaufhof department stores across Germany (€412 mln).
It was also the year that Hausinvest unveiled plans to move into residential investment in a significant way, targeting a €2 bn spend over the next five years in partnership with Wertgrund Immobilien.
Despite the temporary nature of Anschott’s susbsequent reign, he seems to have been a success. Announcing his departure last year, Schmittroth said that he had ‘generated key momentum’.
‘He was responsible for charting the trajectory of Commerz Real towards becoming a sustainable, digital asset manager,’ she said.
During his tenure, he was responsible for a number of initiatives including the launch of Klimavest, the first impact fund for private investors focused on physical assets.
The year 2020 was a far more subdued year in terms of transactions, also due to the outbreak of the pandemic. The group continued to build up its residential portfolio and sold a Frankfurt office campus for over €500 mln while its Hausinvest vehicle was classified as a ‘sustainable fund’ – the only open-ended real estate fund in Germany to be ESG-compliant.
As the Covid-19 health crisis – hopefully – comes to a close in the new few months, the fund manager might also find a fresh equilibrium under Koch’s guidance and take up new challenges on the investment front.
