Nuveen expands German retail platform with Hagen buy

Adding to the existing portfolio, which comprises Campus Center Lübeck and Neuwied Galerie, this is the third property for the investment manager's Core German Retail platform and adds to the €3.5 bn total AUM across Germany.

The retail park, totalling 9,124 m2 of trade and office space, as well as a fitness studio, was completed this year in a new mixed-use development on the former production site of the rusk manufacturer Brandt. It has a diverse tenant mix and is almost fully let. The main tenants include Rewe, Aldi and dm. The anchor tenant of the office space is Brandt Group. The project developer and vendor of the asset is HD Investitions- und Verwaltungs- GmbH.

The acquisition follows a long evaluation period for Nuveen over the future of retail. ‘For a long time, we have been debating what retail parks should look like in order to ensure their success today while also future proofing them,’ said Stefan Wundrak, head of European Research at Nuveen Real Estate.

‘Those parks that have a high proportion of food retailers as well as drugstores, pharmacies and other goods for daily use are the most appealing. Many of these products are not suitable for online retailers, either because they do not have the necessary delivery capacity, shipping costs are too high compared to the value of the goods, or they require an expensive and complex cold supply chain. Our market observation has confirmed that local centres are irreplaceable for the purchase of daily necessities and will only be exposed to minor pressure for change from online retailers over the long term.’

Marcus Mack, senior director, fund management for Nuveen Real Estate, added: ‘Hagen is an attractive addition to our portfolio. The quality of the centre is underscored by the new construction and long-term rental leases. The high proportion of key services tenants, who expect low competition from the e-commerce sector, will also provide consistent income for the platform.’