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Investment Market Cologne: total value of around 1.5 billion euros in Q1-3 2019

[Translate to EN:] Außenansicht Barthonia Forum Köln

The conditions on the financial markets continue to be favourable for real estate investments, despite the fact that general economic conditions have weakened in recent months. On the occasion of Expo Real, we have summarised the most important facts of Cologne’s investment market over the first three quarters of 2019 for you.

Commercially used properties with a total value of around 1.5 billion euros were sold up to the end of September. A number of large-scale transactions was concluded and further substantial real estate deals are expected in the fourth quarter. Investors are increasingly inclined to harness the high level of prices, and to sell on properties they only bought a few years ago to realise profits.

A few portfolios in the three-digit million euro range were sold in the past nine months. By purchasing the Millenium portfolio from Generali Versicherung, CommerzReal acquired three office properties in Cologne for its Hausinvest fund. Among these is the “Constantinhöfe” ensemble in Cologne-Deutz with around 19,000 square metres of rental space.

The Swiss family office East Guardian bought the mixed-use ensemble “Kölnisch Quartier”, formerly known as “Barthonia Forum”. The original production site of the famous Eau de Cologne 4711 is now home to office space, as well as retail and residential units.

A specialist fund by Bayerische Versorgungskammer bought a micro apartment building with around 7,000 square metres of residential space in the form of a forward deal. The building changed hands for around 60 million euros and is located near the technical college in the district of Deutz. Owing to the fact that the property is going to be used mostly as (student) accommodation, this investment was not included when calculating the transaction volume realised with commercial properties.

In the area of commercially used real estate, the high level of prices has increased further over the course of the year to date. Prime yields have remained stable, but many owners and sellers of office buildings have been able to benefit from higher rents. Purchasing prices for condominiums have increased dynamically, once again. High demand from real estate users and the scarcity of secure investments allow for purchasing prices to remain high. Considering the current direction of the European Central Bank’s interest rate policy, even a slight further decrease of yields appears feasible.