| Union
Investment let or relet a total of 430,000 sq m of commercial space in
the first half of 2019, corresponding to an increase of around 80 per
cent on the previous
year. Some 63 per cent of the lettings were at locations in Germany.
Other European locations accounted for 28 per cent, while non-European
markets made up 9 per cent of the total. The leases signed in the first
half of the year represent annual net rent of
approximately EUR 96 million. The overall occupancy rate across all
actively managed real estate funds, based on income, is 96.5 per cent.
Small-scale office lettings in Germany
Office
lettings traditionally comprise the largest share of Union Investment’s
portfolio and accounted for approximately 156,000 sq m. Due to the
existing high occupancy
levels in the German portfolio, the domestic market was dominated by
small-scale lettings. Following the largest letting of 9,500 sq m in the
TM50 property in Nuremberg to the State of Bavaria, there were lettings
in Park.Gate Munich of 2,500 sq m and approximately
2,000 sq m to Ada Health in Berlin.
Successful large-scale lettings in the rest of Europe
Office
leases for significant amounts of space were mainly agreed in other
European markets, including the successful renewal of a lease with
Swisscom for 20,500 sq
m in the Fifty-One property in Zurich. Two notable follow-on leases
were signed in Luxembourg and in the Paris area. KPMG will occupy around
8,500 sq m of office space in the K2 Ellipse and K2 Forte buildings in
Luxembourg, while Union Investment let approximately
7,800 sq m in an existing building in the Parisian sub-market of
Bois-Colombes. Another letting success in France was achieved at the
recently completed Ekla Business office property in Lille. Approximately
8,800 sq m or some 60 per cent of the space in the
property, which Union Investment acquired as a development project
without any preletting, has been taken by a local company.
Performance in non-European markets
Union
Investment’s office space outside Europe is likewise in high demand. In
Shibuya Prime Plaza in Tokyo, some 4,800 sq m were let to IT service
provider NTT Data.
US office markets contributed approximately 21,000 sq m in lettings.
Especially notable here are lease renewals with DLA Piper in the 555
Mission Street property, San Francisco, as well as with Stanley Black
& Decker and GSA Homeland Security in Ten 10th Street,
Atlanta. A further 11,000 sq m of office space lettings were agreed in
Mexico City.
Logistics and hotels make a major contribution
Accounting
for approximately 103,000 sq m across five locations, logistics
properties made an exceptional contribution to the latest results, as
did hotels, which accounted
for approximately 81,000 sq m of lettings. Union Investment’s Asset
Management Hospitality team was able to agree a 30-year extension to the
lease covering the 68,000 sq m of the InterContinental Hotel in Berlin,
among other successes.
In
the retail segment, too, which accounted for 89,000 sq m, successful
lease renewals with established existing tenants were the main story. In
Germany, for example,
this included Saturn retaining 4,500 sq m in Rathaus Galerie Leverkusen
and large fashion chains such as Zara occupying 3,700 sq m of rental
space in LAGO Konstanz and C&A using 2,700 sq m in Köln Arcaden.
Approximately 56 per cent of all lettings in retail
were in locations outside Germany.
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