Patrizia Immobilien has further expanded its retail holdings in Germany with the acquisition of a large portfolio of mainly big-box properties for €320 mln.
The 25-asset portfolio includes the complete real estate portfolio of Savills Investment Management’s German Retail fund CSGRF. The tenants include Edeka and Rewe; Media Markt, Wöhrl, DM, Deichmann and Toom.
'With the acquisition of this portfolio in an off-market transaction, Patrizia has once more demonstrated its aptitude and expertise in the area of major real-estate investments,' said Patrizia CEO Wolfgang Egger.
The 25 real estate properties are scattered among 23 locations solely in the old German Länder. Around 75% of the portfolio's value is accounted for by properties in Bavaria, Baden-Württemberg and Hamburg. With a lettable space of 183,000 m2, most of the properties have been built in the period since 2005 or have been comprehensively modernised.
'The shopping centres and retail parks are located in regions with strong economies and are usually the dominant retail trade destinations in their respective catchment areas,' explained Daniel Herrmann, head of fund management retail at Patrizia. 'The portfolio has a very attractive return-risk ratio. In spite of the usually above-average quality of the real estate and locations, however, we see additional opportunities to add value by means of an active management approach,' Herrmann added.
The portfolio was acquired on behalf of a separate account which has been set up for this transaction. The investor is a German occupational pension scheme.
Patrizia has been actively expanding its commitment in the retail real estate sector in recent months. In January this year Patrizia acquired 21 retail properties focused around western Germany for €250 mln. That deal came less than a month after a similar transaction in which Patrizia picked up 18 retail outlet stores and supermarkets, providing 2000,000 m2 of retail space, also mainly located western Germany.
Patrizia claims it is one of the largest retail property landlords in Germany and manages some €3 bn of retail space across Europe.
New fund
Commenting on the sale of the latest portfolio to Patrizia, Christian Härtl, director of investments of Savills IM in Germany, said: 'The German Retail Fund was designed as a relatively low-risk core-plus investment. Over the nine years since its launch it has achieved a significant return, including a stable dividend. The successful sale demonstrates Savills IM's retail expertise and ability to identify, purchase and actively manage high-value retail properties.'
Savills IM German Retail Fund was launched for institutional investors seeking investment in high quality shopping centres and retail warehouses. Assets were selected for the portfolio owing to their location in above-average catchment areas with high purchasing power, both inside and outside of city centres. After extensive research, properties were identified and acquired, before being modernised and let solely to leading retailers, ensuring very low vacancy rates, Savills IM said.
Thomas Gütle, managing director of Savills IM in Germany, added: 'We have closed the fund and repaid investors in the promised time frame. Selling the entire portfolio to a reputable investor such as Patrizia Immobilien highlights how attractive the German retail market remains to investors. It is because of this continuing attractiveness that we are launching a new German retail fund in the near future.'
