Corestate exits €250 million German portfolio

The Zug-based private equity real estate firm has sold 3,700 residential and commercial properties in Northrhine-Westfalia, Hesse and Berlin to German institutional investors.

Zug-based private equity real estate firm Corestate Capital has sold a mixed-use portfolio of German properties for €250 million, the firm has announced.

The portfolio comprises approximately 3,700 commercial and residential properties in Northrhine-Westfalia, Hesse and Berlin.

The firm described the buyers of the properties to be German institutional buyers.

Corestate described the portfolio as having been acquired in a “distressed state” and added that the firm had repositioned the assets after investing €10 million.

Thomas Landschreiber, chief operating officer of Corestate said: “This has been a very successful transaction through which we fulfilled our business plan as forecasted; decreasing the vacancy and delinquency rates in this portfolio and thereby increasing the cash flow considerably.”

“Not only have we improved the quality of the assets and the overall living and usage conditions for the tenants, we have also turned distressed assets into a stable core portfolio, achieving attractive returns for our investors.”

Landschreiber also said the firm intended to build up its platform in the future after seeing an increased number of transactions coming to the market and added the firm was in the process of repositioning more of its recent acquisitions.”

Corestate has invested on behalf of commercial and residential real estate funds and from its own balance sheet in the past. The firm closed on €490 million in 2008 for its Corestate German Residential Limited fund. Last year, it held a final closing at €400 million for its Corestate German Commercial Properties Fund.