German property investor Patrizia Immobilien AG has acquired an office property in Düsseldorf on behalf of one of its special commercial real estate funds, ‘Patrizia Gewerbe-Immobilien Deutschland III’.
Financial details were not disclosed
The seller is Warburg-HIH, on behalf of its “Pan-Europa-Fonds Nr. 3” investment fund. During the ten-year hold period, Warburg-HIH achieved a 20% increase in annual rental income by restructuring floor areas and lease agreements. The overall performance of this investment following its sale was around 6.4% p.a. (IRR).
‘In a currently very dynamic investment environment, our successful asset management resulted in an excellent return on investment for our investors,’ said Hans-Joachim Lehmann, managing director of Warburg-HIH Invest.
The property, built in 1893 and modernized in 2008, is dubbed ‘Ideenbotschaft’ (embassy of ideas). It is fully occupied by longstanding main client Grey Germany and the Fresenius private university, with a weighted remaining lease term of more than four years. It comprises 12,700 m2 of lettable area plus 127 parking spaces.
Daniel Dreyer, Patrizia’s head of acquisitions commercial, explained: ‘We have seen increasing investment activity in the submarket of Kennedydamm due to the lack of supply in central Düsseldorf locations and the positive development of such secondary locations, particularly in terms of falling vacancy levels and increasing prime rents.’
‘Due to its diversity of industries and the positive underlying fundamentals of the market, Düsseldorf is seen as a long-term stable investment location and this acquisition therefore will deliver significant, sustainable value to our clients,’ Dreyer added.
This is the third acquisition for the ‘Patrizia Gewerbe-Immobilien Deutschland III’ fund. It has a volume of around €400 mln of commercial assets under management (AUM). In total, approximately 60% of Patrizia’s almost €40 bn AUM across Europe are commercial assets.