Whitehall acquires 97-property portfolio in Germany

The private equity real estate firm has bought a package of commercial properties as it ends a mixed year on a high note.

Whitehall, the private equity real estate arm of Goldman Sachs, has bought a commercial property portfolio in Germany from Munich Re, the reinsurance company.

The 97-property portfolio was one of two packages that the asset management arm of Munich Re, Meag, sold. The total value of the two portfolios was €1 billion ($1.3 billion), although there were no separate values assigned to either transaction.

The other package, according to a statement by the German insurer, was a residential portfolio comprising 6,805 properties—predominantly houses and flats—that Meag sold to Patrizia, a listed German fund.

Although Whitehall was successful in the Munich Re deal, it missed out recently on another large acquisition in Germany. The firm was in the running for a €2 billion  portfolio of assets belonging to Deutsche Bank’s open-ended property fund Grundbesitz-Invest. Fortress is expected to acquire the properties after an auction process.

Munich Re was selling the two real estate packages as part of a strategy to diversify its real estate holdings into international markets. The firm is currently seeking investments in both Asia and the US.

The asset manager has about €183 billion of assets under management, of which €14 billion is in the property markets.

Whitehall appears to have enjoyed mixed fortunes this year, winning some competitive auctions and losing others.

It managed to form a €4.5 billion joint venture with struggling German retail chain KarstadtQuelle to acquire the retailer’s property. Whitehall agreed to take a 51 percent stake in the joint venture in return for making an initial immediate payment of €3.7 billion. The complex agreement also allows the retailer to share in the expected upside of property values.

However this year it also lost out to Blackstone in the €650 million battle for Hospitality Europe, a hotel group.

That deal would have landed a portfolio of eight properties across Europe, mainly at key airports, including four hotels at Frankfurt Airport and one each at Schiphol airport in Amsterdam, Brussels and Stockholm.