Deals

Goldman Sachs consortium inks €1.1bn Germany sale

The Wall Street bank plus RREEF Real Estate, Prelios and Generali has reportedly agreed to sell the KaDeWe department store as part of a 17-strong portfolio of assets to Austria’s Signa Holding.

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One of the largest European portfolio sales of 2012 was signed just before Christmas as a Goldman Sachs-led consortium agreed to sell a 17-strong portfolio of assets in Germany for €1.1 billion to Austrian property company, Signa Holding.

The assets are leased to German retailer, Karstadt Warenhaus, and includes the landmark KaDeWe Berlin department store.

New of the sale of KaDeWe was first broken by PERE in October when Goldman Sachs began sounding out potential investors. Since then, the sales process enlarged to include another 16 assets that are held within an investment vehicle called Highstreet, 51 percent owned by Goldman Sachs. RREEF Real Estate, Italy’s Prelios and insurance firm Generali are the other investors.

Signa is an Austrian investment firm with €4.5 billion in assets under management that last year tried to acquire German department store chain Kaufhof. Bloomberg was the first to report that Signa had signed the deal to acquire the real estate assets.

This is one of the largest real estate portfolio deals in Europe of 2012. According to data provider, Real Capital Analytics, PGGM’s acquisition of a UK student housing portfolio for €1.76 billion was the largest. Patrizia Immobilien’s acquisition of a €1.4 billion LBBW German apartment portfolio was second biggest.

The KaDeWe department store came under the ownership of REPIA’s Whitehall Funds in 2006 when it bought a 51 percent stake in the real estate assets of the Karstadt chain, including around 85 department stores and other assets. Two years later, RREEF, Pirelli, Generali and the Borletti family acquired the remaining 49 percent.

As part of the deal, the investors financed a portfolio of 47 Karstadt retail properties and other assets covering 8.37 million square feet of space in a CMBS transaction, known as Fleet Street Finance Two. The €1.12 billion CMBS deal though was widely impacted by the troubles of Karstadt and its parent Arcandor, which both filed for insolvency in 2009. Billionaire investor Nicolas Berggruen acquired the Karstadt chain in 2010.