E & G Investment market report 2017-2018

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Contents. Stuttgart Market trends...............................................................................................3 Key figures....................................................................................................4 Outlook for 2018..........................................................................................6 Your contact partners..................................................................................7 All about real estate.....................................................................................8 E & G Real Estate.........................................................................................9 German Property Partners......................................................................10
The Stuttgart property market. Top-3-deals Merceces-Benz Bank: The State Foundation of Baden-Württemberg has acquired this office trophy with long-term lease from Hines for around 120 million euros. City Plaza: Zurich Group Germany bought this office and business property from a Spanish family office for ca. 105 million euros. Mittlerer Pfad 13-15, Weilimdorf: Ceberus receives around 95 million euros from La Francaise Real Estate Partners for this office property rented by Porsche. Transaction volume breaks the billion barrier again. With a transaction volume of 1.42 billion euros in 2017, the investment turnover in Stuttgart was significantly lower than in the previous years. While 2016 was hailed as a record year, the transaction volume slumped in 2017 by 580 million euros or 29 per cent. Despite this decline, the billion-euro mark has been exceeded for the sixth time in succession. The first quarter of 2017 kicked the year off with a rather moderate investment volume of 190 million euros. Thanks to upbeat activities in the second quarter (EUR 580 m) and the third quarter (EUR 360 m), the property investment market was catching up with the extraordinary run of the previous year. With a turnover of 330 million euros, the fourth quarter could unfortunately not keep pace with the strong finish in recent years, as several double- and triple-digit million transactions were not brought to a close before the end of the year. In the reporting period, a total of 65 property transactions were concluded, of which half ranged at double- and triple-digit million volumes. Investors were showing a keen interest in office property. This asset class alone accounted for around 67 per cent of the total investment volume – not least due to the top sales of “Mercedes Bank”, “City Plaza” and “Porsche Haus”. Residential property achieved a share of 14 per cent of the turnover, followed by plots and development projects with around 8 per cent. Buyers were predominantly openended funds/German special funds with around 23 per cent, as well as insurances with a 16 per cent share in the total transaction volume. 11 per cent of the transactions was generated by private investors/ family offices, while property owners, opportunity funds and public investors accounted for 9 per cent of the transaction volume. On the vendor side, project and property developers were the most active players on the Stuttgart investment market achieving a total share of 21 per cent. They were followed by private vendors and family offices with 15 per cent, and opportunity funds, as well as the vendor group corporates/ owner-occupiers/non-properties - each with around 11 per cent of the overall transaction volume. Compared with 2016, the share of foreign investors buying property has decreased moderately, ranging at around 37 per cent. As vendors, foreign market players have generated 40 per cent of the transaction volume, a significantly higher share than in 2016. Fully let office property at inner city locations reached comparable multipliers as in the previous year. Top yields with a multiplier of up to 26.0 corresponded to a gross initial yield of ca. 3.8 per cent. Also for high street property, yields have remained stable on a high level with multipliers of up to 29.0 (3.4 per cent gross initial yield). Long-term, fully let office property in city fringe and peripheral locations gained multipliers between 18 and 22 (approx. 5.5 to 4.5 per cent gross initial yield). In the reporting period, the property investment market in Stuttgart has continued to perform on an above-average level. By the end of the year, the projected transaction volume of 1.5 billion euros was nearly achieved. I 3
Page 1: Stuttgart - economy with visions. I
Page 5 and 6: Key figures. Transaction Volume by
Page 7 and 8: Your contact partners. In the prope
Page 9 and 10: Entwicklungen 2015/2016 I 15 E & G
Page 12: E & G Real Estate GmbH Börsenplatz

E & G Investment market report 2017-2018

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