Corestate, a specialist real estate investor based in Zug, Switzerland, has sold a German mixed-used portfolio for EUR250m to a number of German institutional buyers.
Corestate had originally acquired the portfolio in a distressed state and has repositioned it over time.
During this process, Corestate invested EUR10m of capital in asset management activities to improve the overall state and quality of the assets.
The portfolio comprises approximately 3,700 commercial and residential units located in Northrhine-Westfalia, Hesse and Berlin.
Thomas Landschreiber, chief operating officer of Corestate Capital, says: “This has been a very successful transaction through which we fulfilled our business plan as forecasted; decreasing the vacancy and delinquency rates in this portfolio and thereby increasing the cash flow considerably. Not only have we improved the quality of the assets and the overall living and usage conditions for the tenants, we have also turned distressed assets into a stable core portfolio, achieving attractive returns for our investors.
“The success of our very hands-on approach shows the importance of strong asset management. We intend to build up our platform even more in the near future as we see an increased number of transactions coming to the market. Furthermore, we are currently in the process of repositioning more recent acquisitions which are undergoing similar asset management improvements. As a result, we are continuing to create a product which caters to the increased national and international demand for stable German property, characterised by capital preservation and strong, sustainable rental cash flows.”