Berlin-based Catella Residential Investment Management GmbH (CRIM) and Catella Real Estate AG via their AIFM platform have acquired two residential properties in Berlin and Hamburg for over €90 million on behalf of the Catella Modernes Wohnen Fund. The acquisitions boost the total investment volume of the fund to €300 million.
Catella Modernes Wohnen focuses on small-scale modern forms of living, including affordable housing for students, young professionals and senior citizens in Germany and European growth regions. The latest purchases include a new development in Berlin-Marzahn, a suburb to the northeast of the German capital, comprising 279 modern flexible one-to-two room apartments, many of them with balconies, as well as a commercial unit with a total rental area of 9,845 sqm. In addition to common areas and co-working spaces, the complex will incorporate generously sized roof terraces to be created by staggering the floors on the seventh level. The project was acquired from the Livos Group, a Berlin-based developer, for approximately €50 million.
The introduction of the Berlin rent cap at the beginning of this year has already led to a 10-20% drop in prices for project developments comprising large residential units ingood to very good locations in sales to institutional investors, resulting in the near total collapse in supply of new rental housing built on behalf of municipal housing companies. Many project developers are now focusing on selling larger residential units as owner-occupied apartments and, in some cases, they are holding on to the land or reselling it.
Michael Keune, Managing Director at CRIM, said: "The project we have acquired is part of a local development being undertaken by the municipal housing company to create space for small-scale businesses and low-budget retailers alongside subsidised housing and rental accommodation for senior citizens. We believe this neighbourhood development has strong potential for the future and will be crisis-proof as it meets the urgent need for affordable, small-scale housing among a wide range of user groups.”
The second acquisition in Hamburg comprises a complex of buildings known as the Herrengraben ensemble, which was purchased for the fund for over €40 million. Located in the southern part of Neustadt (New Town), close to the main church of St. Michael’s and adjacent to the Portuguese quarter, the property consists of 184 residential units with a total surface area of 8,900 sqm. The average size of the units is 48 sqm, complementing the fund’s existing portfolio of small-scale housing for students, young professionals and senior citizens. With around 1.9 million residents, Hamburg is the second largest city in Germany after Berlin (3.8 million) and one of the most dynamic metropolitan areas in Europe with excellent infrastructure, a dense university landscape and a strong and sustainable residential market.
Benjamin Rüther, Head of Fund Management at CRIM,added: "With this acquisition, the fund is further expanding its portfolio of affordable rental apartments, one of the segments that the strategy will focus on throughout Europe in the coming years. Supply of mid-market housing in inner-city locations in Hamburg remains tight amid strong demand and this property caters to a wide range of needs among different population groups. Rental levels per square metre in this building are around 30% cheaper than in the surrounding neighbourhoods of Hamburg-Neustadt, St. Pauli or Hamburg Altstadt (Old Town) which makes these units attractive for many types of renters.”
About Catella Residential Investment Management GmbH (CRIM)
Catella launched its first European residential fund in 2007 with a volume of more than €1 billion and it has since achieved an average net return for investors of 8.5% per year until the end of Q2 2020. The team also launched the first dedicated European Student Housing Fund in 2013.
CRIM is a subsidiary of the Stockholm-based Catella AB group and its residential real estate business comprises portfolio management, acquisitions, sales and asset management. CRIM manages and advises several funds and mandates and has assets under management of over €4 billion in 10 European countries.
For more information contact:
Lisette van der Ham
Head of PR & Corporate Communications
Catella Residential Investment Management GmbH
Upper West, Kantstraße 164, 10623 Berlin
M: +31 (0)6 83200561