AEW has acquired Trinity, a multi-let office property located in Cologne’s Zollstock district. The property was built in 1994 and offers c.22,000m² of lettable office space. It is currently 90% let to a variety of tenants, of which around 70% are public bodies offering strong covenants. AEW has identified an opportunity to leverage upcoming lease events and grow rents which are low compared to the market level. The purchase price was not disclosed.
The asset is located in close vicinity to Cologne’s city center and benefits from direct access to public transport with metro and bus stations situated in front of the building. Parkstadt Sud is the largest urban development project in Cologne comprising c. 265 acres and located directly adjacent to the asset and will significantly reshape the area upon completion.
Matthieu Samaran, Director of Investment at AEW, said: “The Cologne office market has developed very positively in the recent years and is highly resilient, benefiting from the city’s dynamic and well-diversified economy. The property offers a long-term, secure rental income with attractive reversionary potential. The future development of the Parkstadt Süd will also significantly improve the attractiveness of this micro-location over the medium-term.”
Lars-Henning Pylla, Separate Account Fund Manager at AEW, commented: “Cologne can still be considered as one of Germany’s relatively underrated investment spots with future growth potential thanks to high demand and larger-scale development projects covering entire districts. As Cologne’s office vacancy recently dropped below the 3%-mark, we expect to benefit from actively decreasing the property’s under-rented position.”