Acquisition of major commercial development in Munich
AXA Investment Managers - Real Assets completes acquisition of major commercial development in Munich
AXA Investment Managers - Real Assets (“AXA IM - Real Assets”), a global leader in real asset investments and the leading(1) real estate portfolio and asset manager in Europe, announces that it has agreed the acquisition, on behalf of clients, of a commercial development opportunity in Munich, Germany, from TREI, the real estate platform of the Tengelmann Group. The acquisition forms part of AXA IM - Real Assets’ strategy to invest in development opportunities in Tier one and growth cities across Europe, capitalising on individual market dynamics and timing.
The 14,100 sqm site occupies a prime inner-fringe location on Landsberger Strasse, Western Munich, connecting directly to the Central Business District. It benefits from a highly visible location and excellent transport links; backing on to Laim train station; directly opposite a bus station; and less that fifteen minutes’ drive from a number of the city’s major arterial routes.
Demolition of the existing 34,300 sqm buildings, let on short leases with low occupancy levels, is expected to commence in early 2019. The completed development will deliver up to 45,000 sqm of flexible Grade-A office space across three buildings, suitable for a range of occupiers.
Established German developer FOM Real Estate, with whom AXA IM - Real Assets has a growing relationship, will act as the development manager for the scheme.
The Munich office market is characterised by very low vacancy with prime and average rents forecast to continue to rise due to significant supply constraints. Take-up in 2017 was 982,600 sqm, almost 40% above the 10 year average(2), with the unbroken high demand for office space and high rents in the CBD in particular driving demand in less central locations.
This transaction forms part of AXA IM - Real Assets’ ongoing strategy to undertake or acquire large-scale and high-profile developments in growth cities across Europe, building out its portfolio of core assets. AXA IM - Real Assets has completed over 250 projects with a total value of €14 billion(3) across Europe since 2000, and is currently developing a further c. €9 billion(3) of projects across Europe.
Christian Heyn, Head of Development in Germany at AXA IM - Real Assets, commented: “We believe this major commercial development will deliver high-quality office space in what is a very supply-constrained Munich market. Our local team has identified a highly sought after and well-located inner-fringe location that offers potential significant upside through a development to hold strategy. The combination of our own development expertise with that of our partner means we are confident in the long-term return profile of this opportunity in what is one of Europe’s most dynamic fastest growing cities.”
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1 Source: INREV/ANREV Fund Manager Survey – May 2017 – in terms of assets under management
2 Source: CBRE 2017
3 AXA IM - Real Assets’ data as of end of March 2018 (unaudited)
AXA Investment Managers - Real Assets
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Note to editors
AXA Investment Managers is an active, long-term, global multi-asset investor. We work with clients today to provide the solutions they need to help build a better tomorrow for their investments, while creating a positive change for the world in which we all live. With approximately €746 billion in assets under management as at end of December 2017, AXA IM employs over 2,390 employees around the world and operates out of 30 offices across 21 countries.
AXA Investment Managers - Real Assets has €76 billion in assets under management, including €57.9 billion in direct property & infrastructure and €14.2 billion in real asset finance as of end of December 2017(2). We offer a 360° approach to investing in real assets, which comprises opportunities in equity or debt, across different geographies and sectors, as well as via private or listed instruments. We are a global leader in real assets investment, the number one property portfolio and asset manager in Europe(3), and one of the largest worldwide. Our teams have been managing funds and mandates for over 30 years and comprise about 650 people in 13 offices that operate in over 20 countries around the world, which provide us with in-depth knowledge of countries, cities and sectors.
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1 Source: AXA IM unaudited data
2 Source: AXA IM - Real Assets’ unaudited data
3 Source: INREV/ANREV Fund Manager Survey – May 2017 in terms of assets under management
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