Invest Berlin 2Q2020

Trading volume down due to unease and fewer big-ticket transactions

Press release | Berlin

Following a strong start to the year when Aroundtown bought a major shareholding in TLG, the market for commercial investment properties in Berlin slowed appreciably in the 1st half of 2020. Between January and June 2020 the transaction volume totalled €3.46bn or 28 % less than the same period a year before. “The Corona lockdown made investors more cautious about buying Berlin real estate in the second quarter. Overall, fewer trades were finalized. The number of property trades costing 100 million euros or more was also well below the previous year’s level,” says Holger Michaelis, managing director of Grossmann & Berger, a member of German Property Partners (GPP). Grossmann & Berger is confident that more properties will be put on the market in the second half of the year. “In view of ongoing unease regarding how the economy will develop, properties that have been let long-term to highly creditworthy tenants, such as government departments, are in demand,” Michaelis remarks.

Market details:

•    A comparison of half-year figures for the Berlin commercial property market shows that the total posted was second only to the 1st-half record set I n 2019. Mainly, this was due to Aroundtown’s purchase of some 80 % of shares in TLG in the 1st quarter of 2020.
•    Apart from this portfolio transaction, only five properties were traded for more than €100m in the 1st half of 2020. In the same period a year ago, 13 transactions passed the €100m mark.
•    Once again, office properties were the most sought-after class of assets, taking 67 % of the market (Q2 2019: 75 %).
•    Prime yields on offices (2.7 %), commercial buildings (2.8 %) and logistics properties (3.8 %) have become more stable.     

Investment market | Berlin | 2020 Q1 -2
Transaction volume [€ millions] 3,460
against prior yr [%] -28
Share of trading in CBD [%] 10
Proportion of international investors [%] 74
Prime net yield, office [%] 2.7
against prior yr [percentage points] -0.2
Prime net yield, commercial buildings [%] 2.8
against prior yr [percentage points] -0.1
Prime net yield, logistics properties [%] 3.8
against prior yr [percentage points] -0.4
Strongest asset class Offices
Strongest asset class [%] 67

Transaction volume Berlin 2016-2020 / Q1-2

Selected top transactions | investments in Berlin | 1st and 2nd quarters 2020

Street no.
Sub-market Asset class Buyer/investor Vendor Purchase price*
[approx. €m]
Quartier Schützenstrasse Mitte 1a Offices Henderson Park Caleus Capital Partners for GIC 194
“The Grid” Kreuzberg Offices DWS Pandion 129
“Enter” Periphery North Offices DEKA Immobilien Townscape One 120
Germaniastrasse 14-17

Periphery South Offices Colcap Signature Capital Limited 70
Charlottenstrasse 82

Mitte 1a Offices KanAm for Leading Cities Invest fund Quest Investment Partners 55

*The purchase prices stated are based on publicly available data, where none is available an estimate is made; new transactions or those occurring in the quarter dealt with in this report are highlighted.

The complete market survey will soon be available and can be downloaded from our Website.

Press contact

Corinna Fühner

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