Godewind swoops on Frankfurt Airport Center for €168m

German property firm Godewind Immobilien has purchased Frankfurt Airport Center (FAC) for around €168 mln from Madison International Realty and Peakside Capital.

The office complex, which comprises around 48,140 m2 of rental space, generates rental income of €10.14 mln per year, corresponding to a gross initial yield of around 5.5%.

Godewind said the property's vacancy of around 18% offered significant potential for value appreciation.  
The deal follows other recent purchases announced in October, the first since its IPO in March. These include two office properties in Frankfurt and Dusseldorf for a total cost of €73.5 mln and a Munich office priced at €30.5 mln.

'The development of our commercial real estate portfolio is gaining momentum,' said Stavros Efremidis, CEO of Godewind.

'Shortly after our first acquisitions, we acquired another attractive commercial property. The Frankfurt Airport Center is an extraordinary office complex in a unique location and has significant potential for value appreciation, which we will realise quickly. It fits perfectly with our business strategy.'

Located at Frankfurt Airport's Terminal 1, FAC has 182 parking spaces and is leased to a number of airlines and companies in the service industry. The average remaining term of the leases is around 6.2 years.

Last September, private equity firm Peakside Capital and US private equity business Madison International Realty acquired the leasehold interest in FAC from UBS Real Estate on behalf of Publikums-AIF UBS Euroinvest Immobilien for an undisclosed sum.

Peakside had invested on behalf of the Peakside Real-Estate-Fund II (PREF II), while Madison made its investment through International Real Estate Liquidity Fund VI (MIRELF VI).

During their ownership, the partners said that the rental income for the building increased around 20% from around €8 mln to around €10 mln per year, while occupancy increased from 60% to 82%. 

Boris Schran, managing partner of Peakside, commented: 'The asset now presents a long-term investment basis for the future owners.'

The Godewind deal is being financed from own resources to the tune of €76.3 mln, plus an existing financing of €88 mln.

The German investor said it was planning further acqusitions in the fourth quarter of the year, and hoped to close this deal by year-end.


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