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Corestate buys German retail portfolio for €125m

The Zug, Switzerland-based private equity real estate firm has bought a portfolio of retail assets in second tier cities such as Göttingen, Kaiserslautern, Lörrach and Lüneburg. 

Corestate Capital, the Zug, Switzerland-based private equity real estate firm, has acquired an 18-strong portfolio of single retail assets across a string of medium-sized German cities for €125 million.

The assets are located in pedestrianized areas of cities such as Göttingen, Kaiserslautern, Lörrach and Lüneburg. The properties comprise more than 710,000 square feet and contain a number of well-known retailers including C&A, Depot, DM, H&M and S.Oliver.

Corestate has acquired more than 100 retail assets, totaling more than 3.7 million square feet, since launching its high street retail strategy in 2014.

“We have now closed six portfolios in our high street retail strategy, bringing the overall investment volume to over €1 billion,” said Thomas Landschreiber, chief investment officer at Corestate. “The portfolio represents around 110 acquired properties with strong rental covenants. We see high potential in this market and will continue to pursue this strategy,” Landschreiber added.

Corestate’s most recent acquisitions were two high-street retail assets, totaling 368,000 square feet, which it bought for a total of €105 million in December, as part of a joint venture with Sistema Capital Partners, the Luxembourg-based overseas real estate investment arm of Sistema, Russia’s largest publicly traded diversified holding company. The properties are located in Flensburg and Lübeck, two affluent mid-sized cities on Germany’s Baltic coast. While in July, Corestate bought another portfolio, this time 31 high-street retail properties in 30 German mid-sized cities including include Duisburg, Limburg, Mönchengladbach or Schwerin for around €115 million. The seller in both deals was not disclosed.