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Brookfield acquires €1.4bn Berlin trophy portfolio

The Toronto-based asset manager has purchased a mixed-use portfolio on Berlin’s famous Potsdamer Platz from Savills Investment Management.

Brookfield Property Group has signed a purchase agreement with a Frankfurt-based real estate investment unit of Savills Investment Management for a portfolio of properties on Potsdamer Platz in Berlin.

The purchase price was undisclosed but Savills said “it is one of the largest transactions in Germany since 2008” and PERE understood the asking price for the portfolio to be around €1.4 billion.

Located in the center of Berlin, the portfolio includes seven offices and five residential buildings, as well as a mixed-use urban quarter including the Potsdamer Platz Arkaden shopping center. The portfolio also features a Cinemaxx cinema and the Stage Theater, the Mandala Hotel and some 30 restaurants and cafes, as well as more than 2,000 parking spaces in the underground car park beneath Potsdamer Platz.

One particularly well-known landmark is Potsdamer Platz 1, designed by Berlin-based architect Hans Kollhoff. The 103-meter high office tower in a prominent corner location serves as the gateway to the quarter.

The Potsdamer Platz portfolio has more than 480 office occupants, including Hubert Burda, TollCollect, Etihad Airways, ICBC – China’s largest bank – the representative office of the Daimler Group, Habitat, and law firms Freshfields, Raue, Olswang and Morrison & Foerster.

“The sale of such a highly diversified property portfolio as Potsdamer Platz Quarter is further proof of our ability to execute large, highly complex portfolio transactions,” commented Nils Hübener, head of investment at Savills Fund Management, the unit behind the sale. Savills Fund Management was previously part of SEB Asset Management before it was sold to London-based property services firm Savills in September and then rebranded.

The Potsdamer Platz Quarter has gross floor space of more than 5.9 million square feet and was built by the Daimler Group in 1998. It was subsequently acquired for the SEB ImmoInvest mutual fund, one of SEB Asset Management’s funds, in 2008.

SEB ImmoInvest had to be dissolved after failing to meet investor withdrawals. Since the global financial crisis, German real estate mutual funds have struggled to meet redemption requests. Research released by global property services firm Cushman & Wakefield said this enforced liquidation will result in German open-ended funds selling €9 billion of European assets by 2017.