Pirelli RE is teaming up with one of Germany’s top real estate banks in its bid to dominate the country’s asset management activities. HSH Nordbank is a commercial bank conducting its property activities through HSH Real Estate, which operates in equity investments, project development, services and the fund business. In terms of total assets managed (roughly EUR 3.5 bn) it is among the top ten private real estate companies in Germany.
Pirelli RE is teaming up with one of Germany’s top real estate banks in its bid to dominate the country’s asset management activities. HSH Nordbank is a commercial bank conducting its property activities through HSH Real Estate, which operates in equity investments, project development, services and the fund business. In terms of total assets managed (roughly EUR 3.5 bn) it is among the top ten private real estate companies in Germany.
HSH Real Estate paid Pirelli EUR 14 mln for the 20% stake of Pirelli RE Asset Management recently created with the portfolio and asset management mandates of ex DGAG and of BauBeCon, based on a total valuation of around EUR 70 mln.
Pirelli RE Asset Management has over EUR 3.2 bln (book value) in real estate under management, most of which are residential assets and are located in Lübeck, Berlin, Kiel, Hannover and Hamburg. The average entry yield is roughly 6.4%, annual rental income totals over EUR 170 mln and the average vacancy rate is 6.1%. Its commercial properties yield an average annual rental income of some EUR 16 mln.
The company owned by Pirelli (80%) and HSH Real Estate (20%) intends to provide asset management services to part-owned as well as third-party portfolios. The partnership is another example of the business model Pirelli has applied in Poland, Bulgaria and Romania - combining a major local financial partner with a minority stake.
