Fokus Süddeutschland makes a purchase in the affluent Munich suburbs

The new fund has already got a presence in all three top real estate locations in Southern Germany, namely in Munich, Stuttgart and Frankfurt - 3 Matching and scoring analysis to select suitable property

Frankfurt (19 April, 2018) – KanAm Grund Group has bought a property for their new real estate fund for institutional investors in the affluent Munich suburbs. The third property purchased for the Fokus Süddeutschland Fonds is the TechPark Oberhaching in the southeast of the Bavarian metropolis. The multi-story building at Raiffeisenallee, which is mainly used as office and manufacturing space, comprises around 12,500 square meters. It was built in 2000 and is currently undergoing major refurbishment. After investments in Stuttgart and Frankfurt, the Fokus Süddeutschland Fonds, which is concentrating on Germany's strongest economic regions in the south, has added Munich as its third location. The fund has previously bought a high street shopping location in the pedestrian precinct of Frankfurt-Hoechst, and has bought part of the Stuttgart Cloud No 7 building as its second property. The building houses Germany's first "Jaz" design hotel by Steigenberger Hotels AG plus retail and parking space.  Set up recently, this fund has a target volume of 500 million euros within two years and an annual performance of 4 to 5 percent.

The Munich metropolitan region forms a central part of the fund concept. The TechPark Oberhaching property passed into the fund's ownership by the time it fulfilled all the quality standards and expectations of a brand-new building. It underwent refurbishment to parts of the HVAC systems, the main tenants' space, the grounds and the entrance area, which are completely overhauled. The property is being sold by a company of the sole authorized representative and managing director of Octogon Capital GmbH, who is also implementing the refurbishment of the building. It has been agreed to keep the sales price confidential.

The building has one basement and four upper stores as well as 157 outdoor car parking spaces. It is fully let. The main tenants include HTG High Tech Gerätebau GmbH, a specialized service provider in the fields of plant engineering, machine construction and apparatus engineering, working for German and international customers like Bosch, Siemens and BMW.

Oberhaching is located in the South of Munich. At the end of 2016 the vacancy rate in Oberhaching was as low as 1.6 per cent. The increasing interest by tenants in locations in the outer conurbation area of Munich currently observed, is based on the lack of space and high rental prices within the urban area of Munich, which have been rising significantly.

Oberhaching has a dedicated motorway exit and with two stations and bus services, it offers excellent transport links within the Munich region. The local suburban railway S3 line connects the industrial estate directly to Munich central station. The Oberhaching industrial estate along Raiffeisenallee is dominated by big-name, and small and medium-sized enterprises, some of which have their German headquarters in this location. Alongside high-tech manufacturing companies, some food and pharmaceutical industry companies are also located here.

About 36 percent of the German population lives in the southern states of Bavaria, Baden-Württemberg and Hesse, and the population projection for these regions is also predominantly positive. These three states are the regions with the highest income levels and lowest unemployment figures in Germany. Southern Germany is also home to three of the top real estate locations, with Munich, Frankfurt and Stuttgart all cities of international significance. These locations accounted for about 44 percent of the office space portfolio and around 61 percent of the investment volume of the so-called BIG 7 last year. Added to this, the Rhine-Main area, the Rhine-Neckar Metropolitan Region, Nuremberg and Munich are home to robust real estate locations of both national and regional importance. In the case of retail, seven of the ten most significant locations are in Southern Germany, including Mannheim, Nuremberg and Freiburg.

Matching and scoring
The fund management conducts a qualitative and quantitative analysis for the selection of suitable properties in this target region, with 16 defined target markets being continually examined on the basis of 39 indicators. Results obtained from the population structure, economic power, location characteristics and usage-specific KPIs are interpreted by rating analysts. Subsequent to this, equal importance is attached to quantitative and qualitative findings in overall scoring, enabling classification of the potential acquisition according to the categories “recommended”, “opportunity” or “not recommended” when matching location and usage type – office, retail, hotel or residential – and providing the fund management with a sound, transparent basis for making decisions.

About the KanAm Grund Group
The KanAm Grund Group has handled a transaction volume of over USD 30 billion since it was established in October 2000. The owner-managed company focuses on the individual needs of German and international investors, with the geographical emphasis being in Europe and the United States. Of the top 100 investors in Europe in 2016 published in the trade magazine PropertyEU, the KanAm Grund Group was rated as 26th with a transaction volume of EUR 2.9 billion, acquisitions amounting to EUR 1.2 billion and disposals of EUR 1.7 billion.

In order to set it up strategically to face the challenges of the future, the company was reorganized last year into three business divisions under the umbrella of the KanAm Grund Group: KanAm Grund Kapitalverwaltungsgesellschaft (an open-end real estate fund), KanAm Grund Institutional Kapitalverwaltungsgesellschaft (a special real estate fund) and the new KanAm Grund REAM (international investment & asset management advisory). The aim of this strategic repositioning is the continuous development of the KanAm Grund Group from a German real estate fund issuing company into an international real estate enterprise which provides real estate investment and asset management services to German private investors, institutional investors and international investors alike, irrespective of the investment vehicles involved.