Zug-based specialist real estate firm Corestate Capital has sold a portfolio of residential properties in Germany to an unnamed international institutional investor for €83 million.
The portfolio comprises 2,260 housing units located in the German states of North Rhine-Westphalia and Mecklenburg-Western Pomerania with a vacancy rate of just 7 percent. These were acquired in early 2010 from a distressed seller, according to a company statement.
“We focus on creating value in real estate as opposed to passive buy-and-hold strategies,” said Thomas Landschreiber, chief investment officer of Corestate Capital. “Our asset management platform covers the entire spectrum of real-estate-related deliverables, which made it possible for us to stabilize this distressed portfolio within four years and to successfully reposition it on the market.”
On the current macroeconomic fundamentals of Germany, Landschreiber said that in turbulent like these, real estate remains the sole true investment alternative in the country. “Given the persistently upbeat sentiment on the German investment market, the comparatively moderate entry-level investment volumes and the low level of interest on the capital market, real estate investments in Germany remain an interesting proposition. Indeed, the Germany property market benefits more than others from the low levels of interest, which are actually out of step with the economic performance,” he said.
With this transaction, the total revenue from real estate units sold by Corestate Capital since 2013 is more than €1 billion, according to the firm.
While it has been a visible seller of real estate of late, on the investing front Corestate has been investing on a deal-by-deal basis in Germany, a move away from making traditional investments via a fund. Landschreiber told PERE in February last year that apart from Germany, the firm is also targeting investments in stressed markets such as Spain and the Netherlands.
The firm was formed in 2006 by Ralph Winter in Zug, Switzerland. It also has offices in Frankfurt, Essen, London, Singapore and Luxemburg.
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