Meyer Bergman has acquired the iconic Karstadt department store at Berlin’s Hermannplatz from the investment consortium Highstreet Holding. Financial terms of the transaction are not being disclosed.
The 90,000 m² building has been purchased by the London-based manager’s second value-add fund, Meyer Bergman European Retail Partners II (MBERP II). The property is one of the largest city-center department stores in Germany and is fully occupied by the Karstadt retail chain with a long-term lease. The store itself is adjoined by a multi-storey car park with space for 680 vehicles and integrates a block for office and residential use.
Markus Meijer, Meyer Bergman’s Chief Executive, said: “Germany is one of our key target markets and this investment fits squarely with our strategy of targeting defensive prime assets that present opportunities to unlock value through hands-on asset management. It rounds off a year in which our acquisitions team has successfully sourced assets located in the top shopping destinations in major European cities, which we anticipate will generate superior returns for our investors.”
The impressive building has had a long and rich history. Karstadt Hermannplatz was rebuilt in 1951 following its almost complete destruction during World War II, so little survives of the ground-breaking designs by architect Philipp Schaefer when the original department store opened its doors in 1929. The building was enlarged and its façade refurbished in 2000.
Hermannplatz is the intersection of the vibrant Kreuzberg and Neukölln residential districts, which are benefiting from a wave of gentrification aided by the City’s efforts to convert the nearby Tempelhof Airport into a park and revitalize neighborhoods through regeneration initiatives. It boasts excellent public transport connections, since the department store incorporates two entrances to the subway station, and enjoys good bus links nearby to the rest of the city. It is situated on the main trunk road that feeds into the main route from the city center to the future Berlin-Brandenburg Airport.
MBERP II, which is well underway to achieving its €500 million target size, has had strong backing from its existing investors, including European and Canadian pension funds and endowments. The fund targets properties with a dominant market position or in prime locations, and including the Karstadt asset, has a seed portfolio of six assets. Other portfolio assets include the Whiteleys Shopping Center in London’s Bayswater District, assets on the premier shopping streets of Copenhagen, Madrid and Paris, plus the Westfield Broadway shopping center development in Bradford, northern England.
CBRE, Simmons & Simmons, Arcadis and PwC advised MBERP II on the transaction, while HSH Nordbank provided debt finance.
Source: Meyer Bergman
