US Apollo buys controlling stake in Munich business park

Funds managed by US group Apollo Global Management have acquired a controlling majority stake in German real estate business Agrob Immobilien from HVB Gesellschaft für Gebäude & Co., a subsidiary of UniCredit.

Founded in 1867 as a brick factory and now listed in Munich with a market capitalisation of €98 mln, Agrob is a real estate investment company owning and managing a modern 103,000 m2 media and business park located in Munich's suburb of Ismaning. The business park is currently fully let and benefits from a diversified tenant base focusing on established media companies, which currently employ more than 2,000 people on the premises.

The transaction of an undisclosed amount involves the purchase of a controlling stake of 75.02% of common shares and 20.12% of preference shares. It will be funded by equity from Apollo European Principal Finance Fund III (EPF III), which held a final close on 30 November 2017 with total commitments of $4.6 bn.

EPF III maintains a value-oriented, opportunistic strategy by primarily acquiring non-performing, non-core, and capital inefficient whole loans, real assets and performing credit instruments, as well as associated operating platforms.

EPF III has been one of the most active investors in the German office market in recent years and currently manages more than €1 bn of office and logistics assets. Apollo funds have also been increasingly active in the publicly listed real estate sector, following the significant investment in Demire Deutsche Mittelstand Real Estate in February 2018 and the indirect investment in Ado Properties in September 2017.  

Sebastian-Dominik Jais, Partner at Apollo, commented: 'We are excited for the Apollo Funds to acquire a majority stake in Agrob. Apollo has been one of the most active investors in the German office space over the last several years, and this transaction represents an opportunity to grow our portfolio in one of Germany’s strongest markets.'

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