Frankfurt, 6 October 2015 – AEW Europe announces that it has completed the acquisition of an eight asset German retail portfolio. The transaction forms part of a series of acquisitions totalling €56.3 million which AEW Europe and Kintyre has undertaken this year as part of a €150 million opportunistic investment programme on behalf of a US institutional investor. AEW Europe is working with its local partner, Kintyre to source and structure investments in Germany and both parties have co-invested in this transaction.
The portfolio primarily comprises six multi-let retail parks, located at Magdeburg in Saxony Anhalt, Bad Staffeistein and Muhldorf Am Inn in Bavaria as well as Schwalmstadt Treysa and Herborn in Hesse. The 55,000sqm portfolio also includes a standalone retail unit at Bischoffen in Hesse, a DIY store in Herten and a community shopping centre in Schwelm, both in Nord Rhine Westphalia.
The portfolio produces an annual rental income of €5.1 million and is anchored by strong retail tenants such as Edeka, Rewe, DM, C&A, Lidl and Aldi.
As part of this investment mandate AEW Europe and Kintyre Investments are seeking to build an initial portfolio of up to €150 million, through single asset investments of between €5 million – €25 million or larger portfolio investments, where the composite individual assets do not exceed €25 million. It will target assets which are located in regional cities and towns in Germany with populations of between 20,000 – 200,000 inhabitants and have existing cash flow. However, typically the assets will have short dated lease profiles and offer the opportunity to add value through refurbishment, repositioning or redevelopment.
Commenting on the transaction, Russell Jewel, Head of Private Equity Funds at AEW Europe said: “We have a long and recognised track record of managing value add and opportunistic investments across Europe, with over €2 billion of this type of transaction completed in the last five years. Furthermore the German market continues to be an increasingly important area of growth for AEW Europe and the acquisition of this portfolio demonstrates how we are able to ally our own transactional expertise with the local knowledge of our regional partner to source investment opportunities where we can create value for our clients.”
Paul Shiels of Kintyre said: “This portfolio provides all the attributes we are seeking through this venture, being well spread, with a diverse tenant line up along with providing the ability to add significant value through active asset management.”