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The Danish pension fund PFA has acquired the “Century” portfolio from INDUSTRIA WOHNEN for a gross investment volume of more than EUR 1.0 billion. The Domicil Real Estate Group has been appointed by PFA as the exclusive asset and portfolio manager for Germany. The “Century” portfolio comprises one commercial building and 33 residential buildings with more than 3,700 residential units at more than 15 locations across Germany. Approximately two thirds of the portfolio’s residential units are located in major metropolitan centres, including Berlin, Munich, Hamburg, the Rhineland and the Rhine-Neckar region. “Century” has a total rental area of 247,278 square metres, including 228,154 square metres of residential space.
“The properties are primarily located in attractive and very attractive locations in sought-after residential neighbourhoods. What’s more, “Century” also offers substantial potential for rental growth”, said Khaled Kaissar, founder and Managing Partner of the Domicil Real Estate Group. More than half of the portfolio’s rental income is generated in Munich and Berlin. Approximately 30 percent of the portfolio’s residential units were either built after 1990 or have been extensively renovated since 2000. These properties generate around 37 percent of the portfolio’s total rental income. “The portfolio is fairly uniform in appearance”, said Kaissar.
The “Century” portfolio was part of INDUSTRIA WOHNEN’s first real estate special fund, “Wohnen Deutschland”, which launched for institutional investors in 2010 with a target term of 10 years. “Since the fund was launched, we have consistently geared the portfolio towards economically thriving conurbations with strong growth potential. On behalf of our investors, we are now taking advantage of the extraordinarily positive market developments of recent years and have decided to embrace this early exit opportunity”, said Klaus Niewöhner-Pape, Managing Director of INDUSTRIA WOHNEN. The “Wohnen Deutschland” fund is administered by IntReal International Real Estate Kapitalverwaltungsgesellschaft mbH.
The portfolio offers significant potential to retroactively densify and develop more than 40,000 square metres of the portfolio’s residential space. “The portfolio offers real potential to increase rental income, especially given the considerable scope for development”, explained Andre Schmöller, Managing Director of Domicil Real Estate GmbH. In order to fully exploit this potential, PFA and Domicil have partnered with a well-known project developer.
The acquisition of the “Century” portfolio is PFA’s largest single real estate investment to date. “We recently announced our intention to significantly increase the proportion of real estate in our portfolio by 2022. We are now implementing this new strategy, the central component of which is the expansion of our investment activities outside Denmark”, explained Michael Bruhn, Head of Real Estate at PFA. With a balance sheet of approximately EUR 80 billion, PFA is the largest commercial pension fund in Denmark and the fifth-largest in Europe.
PFA was advised throughout the transaction by Gorissen Federspiel and the auditing firm KPMG AG. Jebens Mensching LLP and Jones Lang LaSalle SE also acted as advisors. Arcadis Germany GmbH provided technical services support.
INDUSTRIA WOHNEN was advised throughout the transaction by Heussen Rechtsanwälte, Munich.CBRE GmbH and BNP Paribas Real Estate GmbH managed the transaction process on behalf of the vendor.
About Domicil Real Estate Group
The Domicil Real Estate Group is a medium-sized investment and services company, based in Munich. Its core businesses are investment management in the residential and commercial asset classes and the privatization of medium and large-sized residential portfolios throughout Germany, with sales to tenants and investors. In both fields of business, the complete chain of services, from research to acquisition, financing, structuring of investment vehicles, portfolio and asset management, property management and even exit is carried out within the group of companies. Clients are not only private investors and financial service providers but also institutional investors, such as family offices, banks, insurance companies and pension funds.
About PFA
PFA was founded in 1917 as an independent company by a number of labour organisations, with the sole purpose of ensuring a financially secure future for the employees and their families. Today, PFA is the largest commercial pension company in Denmark with approximately EUR 80 billion in assets under management and the fifth-largest in Europe. PFA has approximately 1.2 million individual customers from a wide range of the largest companies and organisations in Denmark. This means that PFA can keep costs low, it has access to attractive investment options and it is able to attract some of the best investment partners in the world.
Source : Company