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TH Real Estate exits from German JV after 15 years

The global real estate investment management business switches from partner to service provider after selling its 50 percent stake in its Warburg-Henderson Kapitalanlagegesellschft fur Immobilien joint venture to Hamburg property company, HIH Hamburgische Immobilien Handlung.

TH Real Estate (THRE), the global real estate investment management business formed last year by US institutional investor TIAA-CREF and London-based fund manager Henderson Global Investors, has exited from a long-standing joint venture in Germany.

THRE has sold its 50 percent position in Warburg-Henderson Kapitalanlagegesellschft fur Immobilien, a real estate investment management venture formed 15 years ago between Henderson and private German bank MM Warburg to acquire real estate in Germany and wider afield in Europe on behalf of German investors, to HIH Hamburgische Immobilien Handlung, a Hamburg-based property company affiliated to the bank.

No sale price was disclosed in the official announcements or statements made by the respective firms. However, THRE told PERE the purchase price was established “on the basis of an appraisal of the venture’s goodwill using standard methods”.

Warburg-Henderson has been grown to approximately $4.7 billion of assets, $2.15 billion of which resides outside of Germany and which will remain on THRE’s books. And, though it has relinquished ownership of the venture’s German portfolio, it will continue to have exposure to it via the provision of asset management services.

In a prepared statement, THRE said: “All existing products, transaction and asset management services currently provided by us will continue to be so and will be secured under a long term contract. TH Real Estate will also be the preferred asset management provider outside Germany for future products.”

In the statement, THRE said: “Single ownership will enable Warburg-Henderson to increase its efficiency around decision making and support a more nimble approach for its business.” The firm said the decision to exit its stake was made jointly.

Despite the decision to exit from the venture, THRE insisted it remained ambitious to grow its holdings in the German property market. “Our objective is to double our German AUM total within the next three to four years via investment pipeline and further fundraisings.”

On that point, the firm said it was now in a better position to be a partner in the country for new ventures and partnerships and that it would continue to grow its pooled spezialfound business which includes the German Retail Income Fund, the Core German Retail Fund, the German Logistics Fund and ICF German Logistics, vehicles at various stages of life. Combined, the funds have assets valued at more than €500 million.