Within the scope of a separate account mandate, Deutsche Investment just bought an attractive portfolio of mixed-used residential and commercial buildings in an off-market deal. The seven properties comprise a combined total of 97 residential units, 12 commercial units and 12 parking spots, providing a total lettable area of around 10,800 sqm. The total investment volume amounts to c. 21 million euros.
The properties are situated in sought-after district locations, including on Karl-Liebknecht-Strasse and Johannesallee, which benefit from a vibrant infrastructure and very easy access to public transportation.
Residential accommodation accounts for around 85% of the lettable area, commercial use for the remaining 15%. The majority of the residential units are larger than 60 sqm, which makes them particularly attractive for couples and families, meaning a target group that is more affected by the housing shortage in Leipzig than others. The fact is also reflected in strong tenant loyalty: 54% of all leases have been in place for more than ten years, suggesting a stable and content tenant constituency.
Most of the highly presentable properties date back to the Belle Époque. Six of the seven buildings were completed between 1875 and 1912, supplemented by one building from 1927. The micro-environments are characterised by excellent infrastructure and convenient access to public transportation.
The commercial floor space divides into offices (37%) and gastronomic premises (43%). The gastronomy units, such as those on Johannisallee or on Karl-Liebknecht-Strasse, benefit from particularly high visibility and are well-frequented. Stores and doctors’ surgeries account for another 20% of the commercial rent revenues.
“With the acquisition of the Leipzig portfolio, we secured an investment of robust substance in one of Germany’s growing metro regions. The combination of stable tenant structure, attractive dwelling sizes and sought-after micro-environments offers long-term potential – both in terms of the portfolio’s management and in terms of performance,” said Sascha Basic, Member of the Board of Deutsche Investment Kapitalverwaltung AG.
During the transaction, Deutsche Investment was advised on legal issues by the law firm of VESTHAUS Rechtsanwälte and in regard to the mechanical and engineering survey by CBRE Berlin. Wüest Partner acted as appraisers.
