Peakside Capital, a specialist European real estate private equity firm, has announced that a company majority owned indirectly by the Peakside Real Estate Fund I has sold a residential complex consisting of 612 residential units to TAG Immobilien AG.
The Berlin asset was originally acquired by the Peakside team in 2007 from a German mortgage bank as a non-performing loan. Since then, Peakside has worked alongside its operating partner, Wertgrund Immobilien AG, on a number of active management initiatives to improve the performance of the properties. As a result of this, over a period of three years, the vacancy rate across the asset reduced from 13% to below 3%, rents increased from an average of 4.00 per m² to 4.37 per m² and the delinquency rate reduced from 46% to 7%, leading to an overall increase in net operating income over the period of 68%.
The disposal was made on behalf of the Fund, with the proceeds being used to invest in new opportunities across the European real estate market with a particular focus on Germany and CEE.
Stefan Aumann, Founding Partner of Peakside Capital and Head of Asset Management said: "The asset management program and the subsequent disposal of this holding is an excellent example of our ability to create value for investors by working with experienced local partners, delivering on key initiatives to maximize income and securing an attractive exit price on completion of the program.
"We plan to re-deploy the proceeds of the sale into other investments with value creation potential. Through our experienced in-house investment advisory team, we expect to be an active player across a number of European real estate markets with particular focus on Germany and CEE, where we see particular opportunities to deliver value for our investors."