Optimum Asset Management, the specialist real estate investment manager, has announced the off-market acquisition of a 1,636 sqm commercial building in Düsseldorf, Germany, through its German Real Estate Fund IV (GREF IV). The fund is the fourth iteration in a series of strong performing German real estate funds pursuing both residential and commercial properties in the range of €5-40 million.
Built in 1986, the building enjoys a privileged location close to one of the main commercial arteries of Düsseldorf with excellent access to public infrastructures (metro and central station). Entirely dedicated to office use, the building consists of eight stories, including a ground floor, and presents good general and structural condition.
Targeting a total size of €600 million, GREV IV seeks to add value by optimising mispriced and mismanaged residential and commercial assets near major infrastructure and employment hubs. The primary target area is Berlin, with selected investments in high-growth, supply-constrained cities such as Hamburg, Dresden, Leipzig, Cologne and Düsseldorf. The Fund acquired a 4,367 sqm residential building in Berlin-Tiergarten earlier this year.
Alberto Matta, Chairman and Founder at Optimum Asset Management, said: “As we build out our portfolio, we look to invest in German real estate with significant opportunity for value creation. The diversification of residential and commercial properties within a high-growth, supply constrained market creates opportunity for consistent return on investment whilst providing a safe haven for our investors during periods of market downturn. While apprehension in the real estate market persists, the long-term fundamentals of niche markets remain attractive.
Düsseldorf’s positioning as an international business and financial centre make it an attractive location for global corporations. As such, we seek to capitalise on these strong fundamentals through local expertise and continue our strong track record in delivering returns for our clients.”
With the support of its 12-strong Berlin team, which includes nine German asset managers headed by André Gretsch, Optimum has completed over €1.5 billion of real estate transactions in the region since 2006, establishing tailored asset management initiatives to improve cash flows and create value by timely exits.
The firm’s track record includes Property I, the Berlin-focused real estate fund, which was fully realised in 2014, achieving an IRR of 19% and a 2.3x MOIC. Optimum’s Property II (2011 vintage) and Property III (2014 vintage) are centred on Berlin and Potsdam, with additional properties in Dresden forming part of the Property III portfolio. Property II and Property III currently have a total return of around 290% and 170% since inception, respectively. Realised assets have achieved an IRR ranging from mid-teen to 30+%.