PATRIZIA acquires office building in Munich for private investor fund
PATRIZIA Immobilien AG has purchased an office building on the Leopoldstrasse in Munich, on behalf of a private investor real estate fund.
The property is located within the central beltway, “Mittlerer Ring”, and offers approximately 10,000 square metres of leasable area across seven floors in a central location. It is majority let to the Bavarian International School on a 20 year lease, with oil company BP in occuping of the remaining space. “With the purchase of this premium property, which has a long-term lease and is situated at one of the most sought-after addresses in Germany, we will soon be able to offer private investors a very attractive investment product,” explains Joachim Fritz, the Managing Director of PATRIZIA GrundInvest. The seller of the property is a private equity company. The parties have agreed to keep the purchase price confidential.
The property is an office building originally developed in the 1970s, and well-located in a mixed-use business and residential area in the Schwabing District. The asset was completely refurbished in 2015 and has been occupied by a renowned international school since the beginning of 2016. Over 8,000 square metres of the asset has been leased to the Bavarian International School for 20 years. This lease generates approximately 96% of the planned rental income. The remaining area of approximately 2,000 square metres is leased for another five years to BP.
The private school serves children of international professionals and executives, as well as children who are preparing for a globalised world through an education in the English language. As a business metropolis that is open to the world and home to seven DAX corporations, Munich has a significant and long-term market potential for international private schools such as the Bavarian International School. The Bavarian International School has already successfully established itself in the market and has added another location with this city campus.
“We would like to raise approximately EUR 30 million of equity from private investors for the new private investor fund, for which the annual disbursements are projected to be an average of 4.0% before taxes,” explains Andreas Heibrock, Managing Director of PATRIZIA GrundInvest, when he announced the key financial figures of the fund. The term of the fund is initially approximately 10 years. It is possible to invest with as little as EUR 20,000. It is expected to be issued in the first quarter of 2017.