Union Investment and Hines have acquired the MediaWorks office project in Munich’s Werksviertel district in a joint-venture off-market transaction.
Union Investment holds the vast majority of the shares, while Hines acts as equity partner and operational developer on site.
Union Investment is contributing the shares to its two open-ended retail real estate funds UniImmo: Deutschland and UniImmo: Europa.
Real estate funds managed by Blackstone acted as sellers of the approximately 96,000-square-metre site. The project also includes an existing parking garage on the property with 825 parking spaces. The anchor tenant with a long-term lease is RF360 Europe GmbH, a subsidiary of the U.S. semiconductor manufacturer Qualcomm.
The parties have agreed not to disclose the purchase price.
MediaWorks Munich is located between Munich’s eastern railway station and Karl-Preis-Platz and forms the southern entrance to the Werksviertel. Since the 1990s, the former manufacturing site has been upgraded to a lively and up-and-coming location and is now home to over 100 companies. The infrastructure is enriched by gastronomy, shops, sports, a conference center, doctors, child care and the newly planned concert hall. With cycle paths, the East Railway Station, the underground at Karl-Preis-Platz and optimal connection to the city ring and the A8, A94 and A99 motorways, MediaWorks Munich is ideally connected in terms of infrastructure.
Union Investment and Hines are jointly planning a comprehensive refurbishment of the portfolio to develop the property into a modern campus. The focus will be on sustainable office space that meets the requirements of new ways of working in terms of flexibility and efficiency.
”Environmental awareness, quality standards and social responsibility have been top priorities for both Union Investment and Hines for decades. Therefore, the new MediaWorks will also meet high ESG standards and will remain in the portfolio for the long term. The planned total investment in the project, including project development, will exceed one billion euros,” said in the statement..
“Following the acquisition of the Neue Balan 27 project in the immediate vicinity, which is already well let, we are delighted to further expand our commitment in Munich at this location on the largest and most prominent site in the up-and-coming Werksviertel district. The investment is impressive first and foremost because of its enormous development potential, which we intend to drive forward in the short term by refurbishing the vacant space,” said Alejandro Obermeyer, Head of Investment Management DACH at Union Investment.
“As an investor with a strong equity base, joint ventures with experienced project developers such as Hines offer us very good opportunities to enter large-volume projects at an early stage with shared entrepreneurial risk. We consider this to offer strong development prospects for our future growth in Germany, but also abroad.”
Alexander Moell, Senior Managing Director at Hines, adds: “With MediaWorks Munich, we are participating in a significant investment in one of Munich’s most attractive submarkets. In addition, this acquisition is testament to our belief in one of the most dynamic office locations in Europe. The site offers the best conditions for a sustainable project and we look forward to leveraging the great development potential together with Union Investment over the coming years.”