Cite Carre Magdeburg, Germany

Background and Opportunity

• Acquisition for an 8.3% yield of an under-managed city block comprising 134,600 m² and 1,600 car parking spaces comprising the bulk of Magdeburg’s CBD
• Asset was one of the final assets in a German closed ended fund in liquidation mode
• Business plan to unlock rent reversions through regears and re-lettings and the re-positioning of the retail mall

Transaction Progress

• The JV regeared or re-let over 60% of the office and retail space increasing the WALT and the rent by over 25% during the holding period
• Retail mall refurbished and re-positioned via capex programme with lease extended for main anchor supermarket tenant
• Accretive senior financing facilitated a cash on cash return of over 20% p.a.

Current Status

• Property sold in December 2020 to a German institutional investor
• The JV generated a post tax profit of over 30% IRR / 2.5x on equity