Flight of capital into core real estate produces second highest annual result ever
The top priority for most investors in 2020 was to minimize risk. Accordingly, 43 % of the volume traded (€2.29bn) related to properties in Hamburg City.
A further indication that buyers were focussing on core properties came from the 15 trades priced at over €100m each, which dominated the market and accounted for a share of 52 % (2019: 10 trades, 33 %). The average purchase price per property rose to a new record level of €48m (2019: €37m).
Although the issue of working from home was omnipresent, investors still place faith in office blocks, which remained the most popular real estate investment, comprising 53 % of total trades. Retail shop properties, badly hit by the lockdown, accounted for 15 %. Hotels, however, were given a wide berth by most investors (2 %).
Whereas portfolio sales had pushed up the volume of transactions in the middle of the year, they played only a minor role at the end of 2020. Accounting for a 27 % share, their volume fell well below the prior year (40 %).
Prime yields on the asset class which seems crisis-proof, logistics properties, contracted year on year to 4.00 %. The prime yield on logistics properties will probably fall further, as has already happened at other top locations. On offices and commercial buildings the figures were unchanged year on year at 2.80 % and 2.70 % respectively.
The current crisis has caused some investors to adjust their strategies. They focus on properties let to good tenants in attractive locations. This trend is likely to persist while the crisis lasts. It would seem unlikely that the good result of 2020 will be repeated 2021.
Investment market | Hamburg | 2020 | Q1-4 |
Transaction volume [€ millions] | 5,370 |
against prior yr [%] | +24 |
Share of trading in CBD [%] | 43 |
Proportion of international investors [%] | 38 |
Prime net yield, offices [%] | 2.80 |
against prior yr [percentage points] | ±0.00 |
Prime net yield, commercial buildings [%] | 2.70 |
against prior yr [percentage points] | ±0.00 |
Prime net yield, logistics properties [%] | 4.00 |
against prior yr [percentage points] | -0.25 |
Strongest asset class | Offices |
Strongest asset class [%] | 53 |
Project/property Street no. |
Sub-market | Asset class | Buyer/investor | Vendor |
Purchase price* [approx. €m] |
“Johann Kontor”, Klosterwall 6-8 |
City | Mixed use | Captiva / HanseMerkur / Aug. Prien Family Office | Aug. Prien | > 300 |
Gruner + Jahr publishing house, Am Baumwall 11 |
City | Offices | Tishman Speyer | Gruner + Jahr | 300 |
“Karstadt”, Mönckebergstrasse 16 |
City | Retail | Signa Holding | Quantum Immobilien | 260 |
“EDGE ElbSide”, Amerigo-Vespucci-Platz |
HafenCity | Offices | HanseMerkur | EDGE Technologies | > 220 |
“HCOB-Zentrale / Perle”, Gerhart-Hauptmann-Platz 50 |
City | Mixed use | Signa Holding | Hamburg Commercial Bank (HCOB) | confidential |
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