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Residential Portfolios – German Investment Market Booming
2 Jul, 2012, Frankfurt
According to figures of the real estate advisors Cushman & Wakefield (C&W) in the first half of 2012 a total of 23 portfolio transactions of more than 250 dwelling units took place (H1 2011: 43). Despite the significant fall in the number of transactions in this segment the number of units changing hands actually increased, due to several very large transactions, to some 133,000, an increase of 96% compared to the first half of 2011. Investment volume was approx. € 6.62 billion, a rise of 100 % over the same period (H1 2011: € 3.31 billion).
This means that to mid-year, both in terms of traded dwelling units and transaction volume,
the figures for 2011 have already been substantially exceeded. In 2011 as a whole, and
including the GSW flotation 76 transactions took place involving some 121,000 dwelling units
and total investment volume of € 6.18 billion.
The average purchase price achieved has fallen slightly since the end of 2011 at some € 770 /m² (2011: € 790 /m²). The average multiples achieved in this segment have also softened to 13.0 times current net rent (2011: 13.7-times). The breadth of variation remains wide: while for properties in eastern Germany in secondary locations, multiples can fall well below 10 times, investors are prepared to pay up to 16 times for attractive portfolios in the western urban regions or in Berlin.
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