CA Immo has acquired Pohlstrasse 20, an office building located in the prime Potsdamer Platz submarket in central Berlin, in an off market deal, for € 47.35 million (c. € 6,100/sqm).
Pohlstrasse 20 consists of 7,788 sqm lettable space (96% office) and 126 underground parking units. The property is 100% occupied by five tenants, with main tenants Bombardier and Thyssen Krupp Elevator making up for ca 80% of the occupied area. Remaining WAULT to lease end is 4.5 years.
CA Immo said the purchase price reflects a day one gross initial yield of 2.7 % on in place gross rental income of €1.3 m.
”With an average in place office rent of c. € 12.50/sqm, material rental reversion is expected to deliver in excess of a 5.5 % gross yield once stabilized,” said CA Immo in a statement.
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“With the ‘Pohlstrasse 20’ office building we are buying a great asset in terms of quality, tenant covenant, and location, in one of the most attractive office submarkets in Berlin. With an existing footprint of four existing buildings and one under construction in the submarket, we have high conviction on our ability to capture rental reversion at this property given recent leasing experience in our existing portfolio (post-COVID) at rents more than double those currently in place at ‘Pohlstrasse 20’. With an active asset management business plan to upgrade and modernize the property as leases roll, we benefit from the immediate rental income secured by high quality tenants and a low rent basis giving a large margin of safety,” said Keegan Viscius, Chief Investment Officer (CIO) of CA Immo.