CORESTATE Group acquires German residential and commercial portfolio (CH/DE)
Wednesday 18 January 2012
CORESTATE Group, a specialist private equity real estate investor based in Zug/Switzerland, with partner offices in Frankfurt, Essen, London, and Luxembourg, has announced the acquisition of a portfolio comprising 3,000 residential apartments in Berlin and an office building in Stuttgart.
In total, the transaction amounts to approximately €230 million and was characterized by a complicated debt structure with multiple lenders.
The well-maintained and well-located properties were acquired from a foreign investor who had purchased the assets during the peak of the German real estate market. The Stuttgart asset was acquired at an attractive yield of 7.4% and is let on a long lease to the State of Baden Württemberg.
CORESTATE plans to invest additional capital across the portfolio in order to refurbish/upgrade the properties.
Phillip Burns, CEO of CORESTATE, said: “The complexity of this transaction is characteristic of the challenges facing German/European real estate markets in particular for the banks. The restructuring of debt, dealing with the sensitivities and priorities of multiple lenders is highly complicated and something that we expect to see replicated in an increasing number of stressed situations over the next couple of years.”