Union Investment has acquired the Nürtinger Tor development project via a forward funding deal.
The building at Kirchstraße 34–36 in the heart of Nürtingen dates back to 1971. Currently known as the Nanz Center, it is being converted into a mixed-use shopping and amenity centre.
Completion is scheduled for the second half of 2023.
The acquisition is being made for open-ended real estate fund immofonds 1, which is marketed solely in Austria. The vendor, the Geiger Gruppe, is also handling the extensive development and upgrading of the building. The purchase price was not disclosed.
“Nürtinger Tor is a good example of how the conversion of an existing building into a well-positioned, sustainable and taxonomy-compliant local shopping property can succeed. Instead of demolishing the property and building a new one, the decision was taken to extensively refurbish the existing building while retaining the load-bearing structure, thereby saving grey energy. Repurpuse of properties needs to play a more prominent role in efforts to achieve climate targets and meet rising ESG requirements,” said Henrike C. Waldburg, head of Investment Management Global at Union Investment. This view is shared by Roman Höhne, head of Geiger Projektentwicklung’s local office, who added: “The refurbishment of Nürtinger Tor is an excellent example of how the Geiger Group is able to successfully deliver on its corporate goal of sustainability.”
During refurbishment, the property will be stripped back to its load-bearing structure. It will then be completely reconstructed, including the building envelope and technical services. Transformation of the existing building in this way is taxonomy compliant and the aim is to achieve an EPC A rating on completion.
Nürtinger Tor offers total rental space of 9,400 sq m and is currently 98 per cent pre-let. The centre’s anchor tenants are Media Markt and food retailers Aldi Süd and Denn’s Biomarkt. The tenants on the upper floors comprise a fitness studio, two medical practices and a rehabilitation centre. The tenant mix is rounded out by two food units and a shoe retailer.
“In the current market environment, our focus within the retail segment is on high-quality defensive investments that generate stable cash flow. Accordingly, we intend to continue expanding our portfolio through targeted acquisitions of grocery-anchored daily-needs providers in integrated locations,” said Roman Müller, Senior Investment Manager at Union Investment.