Tishman Speyer and joint venture partner UBS Real Estate Finance have seen the sale of their German Opernturm Tower development collapse due to sudden loss of confidence in the rental prospects of the finanical sector.
German open-ended fund KanAm has pulled out of a deal to buy the under-construction tower less than a month after agreeing terms.
A KanAM spokesman told Reuters: “KanAm has decided not to exercise its option to buy the OpernTurm. The reason is the current turbulence in financial markets, which is making the outlook for banks uncertain. At this stage the fund does not want to increase its rental exposure to the financial industry.”
The landmark OpernTurm building in Frankfurt is a 67,000-square-metre office situated between the banking district and the west end of the city. It measures 168-metres-high.
The tower is not due for completion for another 15 months. So far, more than 50 percent of the rental area has been leased with the main tenant being UBS Deutschland AG, a subsidiary of UBS, which is moving into the building as its German headquarters. Lawfirm Morgan Lewis is also taking space in the building to establish its presence in the country.
KanAM announced last month that it would be able to finance the deal without debt. A Reuters source suggested the deal was in the range of €400 million to €600 million.