Inditex chairman Amancio Ortega is teaming up with Santander's Portuguese private banking arm Banco Internacional do Funchal (Banif) to buy an office complex in the centre of Berlin. Banif's property unit, Banif Immobiliare, and Ortega, owner of fashion retail chain giant Zara, are buying the building from the US property company Tishman Speyer for EUR 275 mln.
Inditex chairman Amancio Ortega is teaming up with Santander's Portuguese private banking arm Banco Internacional do Funchal (Banif) to buy an office complex in the centre of Berlin. Banif's property unit, Banif Immobiliare, and Ortega, owner of fashion retail chain giant Zara, are buying the building from the US property company Tishman Speyer for EUR 275 mln.
The eight-storey office complex is located in Berlin’s business street Friedrichstrasse, and is the largest of the three blocks constituting the FriedrichstadtPassagen. Designed by architect Oswald Mathias Ungers, the building was completed in 1995 and provides a gross area 50,500 m2, mostly for office use, but with minor retail and residential areas. Market sources suggests that the complex provides monthly rents of EUR 20/m2. The office block currently houses the German headquarters of Coca-Cola, but it is also leased to other firms such as Citibank and AT Kearney, while its retail units are let among others to the luxury brand Gucci.
Banif, also owner of the Niketown complex in Berlin, believes that the German market provides investors with higher yields and more liquidity with respect to the Spanish one. 'We are looking for investment opportunities in the German commercial sector, in particular in buildings which are leased and provides higher yields', Banif said.
In September, Ortega was rumoured to have made an offer for part of the EUR 4 bn real estate that Santander has put up for sale to finance its bid for ABN Amro. Over the last year, Zara’s founder Ortega has bought a historical building in Rome for EUR 130 mln and a Norman Foster-designed building in London, but this deal would represent his first foray into the German market. He is also an investor in the Azora Europa, a new fund launched in February to invest EUR 1 bn in real estate across Eastern Europe, particularly in Poland, Romania, Bulgaria and the Czech Republic.
With their home market cooling down after ten years of property boom, property companies are losing appetite for Spanish real estate. Spanish firms are increasingly heading for Germany and Eastern Europe. Major players such as Lubasa, Metrovacesa, Fadesa and Chamartin have entered the German market over the last year. Spain's major Metrovacesa spent EUR 340 mln last month to buy two German properties from Tishman Speyer, and said it acquired a plot of land in Berlin for the development of an office complex.