By 2015, a further 1.5 million dwellings in Germany will be sold to investors via portfolio transactions. Of these, more than 1.1 million housing units will probably come from the public sector, especially from municipalities. These are the findings of the current study on 'Residential portfolio transactions in Germany, published by HSH Nordbank.
HSH Nordbank expects 820,000 dwellings owned by municipalities to be sold by 2015. In Western Germany, the municipalities are expected to privatize almost one in every two dwellings, compared with about one in every five in Eastern Germany, concludes the Bank's real estate research. "Given both the difficult budgetary situation faced by the municipalities and the capex requirements they are facing if they are to enhance their appeal as centers for business, municipalities will abandon their restraint," comments Bernhard Visker Head of the Real Estate segment and designated member in charge of regions at HSH Nordbank. A considerable residual portfolio of 1.65 million housing units will remain with the municipalities.
According to the study, the Federal government and the Federal states will sell all of their residual holdings of approx. 300,000 dwellings, and even faster than the municipalities, within the next few years. The largest transaction is expected to be the sale in the near future by LEG North Rhine-Westphalia, which owns approx. 100,000 housing units. Moreover, companies that are not active in the real estate sector are expected to continue focusing on their core business and sell almost all of the remaining 340,000 company-owned dwellings.
Source: HSH Nordbank