Germany Real Estate Companies Remain Strong


Today, the COVID-19 pandemic is still the number one issue in most countries. Because of this, some people are required to work from home and tenants are looking for flexible rental solutions in office buildings. In most countries like the United States and Canada, most people choose to rent an apartment or stay in a hotel instead of working at their homes.

Office buildings are part of TLG Immobilien AG (TLG) portfolio, a company controlled by Aroundtown. Aroundtown is Europe’s third-largest real estate company focused on generating high quality properties. Aroundtown recently concluded a long term lease, for approximately 8 years, to an office building located in the south of Frankfurt/Main in Neu-Isenburg.

The new tenant in Neu-Isenburg is Adapteo GmbH, Adapteo offers flexible rental solutions for schools, daycare centers and offices in the private and public sectors. Services include development, construction, leasing and sales of modular buildings and container facilities.

The leased space is on two floors and an area of about 2,000 sqm leading to full occupancy of the office building. The asset is located in the south of Frankfurt/Main in Hugenottenallee 167, 63263 Neu-Isenburg providing good connectivity to Frankfurt’s city center and the international airport.

From the current study in PricewaterhouseCoopers LLP (PwC), a consulting firm, and ULI, a nonprofit research organization, some cities in Germany have shown stable and strong investment in the market. In commercial real estate transactions, Germany ranked second place after the United Kingdom, and an increase of economic growth would be expected this year.

PwC conducted interviews with some people with knowledge in the real estate industry. A private equity investor said: “The way governments handle the crisis will have an impact on the attractiveness of the market for foreign investors because there’s that sense of security that in times of crisis the government has stepped in, has taken the right measures, and has protected the value of the economy.”

In addition to this, one interviewee says, “The perception that Germany is a heaven will be just further increased.” Another investment banker confidently speaks and says, “Germany has got a strong economy, has managed the pandemic pretty well and is open for business. It’s back in action.” A pan-European investment manager shares his point of view: “Our business in Germany is growing more than any other part of our European network. The theory is that Germany is in better shape than most other economies. And therefore, in a way, if you’re going to buy anywhere, you buy in Germany.”

The consensus is that COVID-19 has given hybrid working a boost, with 91 percent of survey respondents agreeing that there will be more of it in the future, a combination of working from home (WFH) and at the office. As one senior figure at a big financial services group points out, businesses proved that WFH could keep the show on the road during the pandemic, and “there’s a clear preference amongst a significant percentage of the workforce to maintain some level of hybrid work place.”

Aroundtown is Europe’s third-largest real estate company, committed to sustainable investment and focused on income generating quality properties that have potential for value-add in central locations mainly in Germany and the Netherlands. The portfolio comprises mainly office, residential and hotel properties, residential business is covered by the stake in Grand City properties, owning 71,000 apartments across Germany, the commercial and hotel assets, owned directly by Aroundtown. Hundreds of experienced employees from all areas of the value chain ensure that Aroundtown effectively realizes long-term potential. Professional organization, flexibility and innovation make Aroundtown a reliable partner for growth and success. Aroundtown operate performance improvements through reducing vacancy, increasing market rents, and lowering operating costs. These three properties will continue to deliver strong funds from operations (FFO) per share growth

Aroundtown is a member of the European Public Real Estate Association (EPRA), the German Property Federation (ZIA) and the German Sustainable Building Council (DGNB). as well as a signatory of the United Nations Charter of Diversity. Aroundtown has received multiple EPRA BPR Gold Awards and EPRA sBPR Gold Awards for its transparent financial and sustainability reporting. Avisco (controlled by Mr. Yakir Gabay) holds 10% in Aroundtown followed by Blackrock at 5%. Other shareholders include Norges, Vanguard, Allianz, BNP Paribas, Japan’s Government investment fund, Aliance-Bernstein, Dekabank, State-Street, Bank of Montreal and many other leading international investors. The main bond investors include ECB, GIC, Union Investment, DB, UBS, CS, M&G, Pictet, Credit Agricole and many other major institutional investors.