Pan-European commercial real estate investor M7 Real Estate (M7) has sold a portfolio of 27 retail properties in Germany, on behalf of M7 ISLAY fund, to the FIM Unternehmensgruppe (FIM Group) for € 86.4 million.
The retail portfolio, which includes a mix of high quality, food anchored tenants, comprises a total rental area of 72,594 sq m. The assets are 92 per cent let to a range of occupiers including Lidl, Netto, Edeka, Rewe, Dänisches Bettenlager and SIEMES Schuhcenter GmbH & Co. KG. The largest single asset, which is on Hildesheimer -Strasse in Hannover, comprises 10,710 sq m of space.
M7 has acquired the retail properties in Germany for its fund in separate transactions over 2015 to 2016. M7 has increased the occupancy of the portfolio from 80% to 92% and extended the unexpired lease term to 6 years.
“This sale is in line with our business plan and has delivered attractive returns for our investors. Leveraging our asset management expertise, we have improved the performance across the portfolio, attracting a diverse occupancy base to these well located assets and creating an attractive market proposition,” said Alyssa Huse, Managing Director, of M7 Real Estate in Germany.
“We see good potential for value enhancement in the portfolio, and we want to continue the path already taken by M7 by optimising individual properties,” said Jan Lerke, the FIM Group’s Managing Director responsible for real estate management. “In this regard, we are holding talks with initial operators. The retail package is particularly interesting for us because of the individual locations in major cities such as Hanover or Saarbrücken,” concludes Lerke.