01.10.2019

KanAm Grund Group: Performance overview of the first nine months

Real estate transactions worth 1.6 billion euros in 9 months - 75 % within the institutional investment business - Four real estate sales/acquisitions in Germany and Europe per month

Frankfurt, 1 October, 2019 – Within the first 9 months of this year, Frankfurt based KanAm Grund Group has already realized 37 real estate deals with a transaction volume of over 1.6 billion euros. Three quarters of these transactions formed part of the institutional investment business, the remaining quarter being in private investment. This includes the purchase of 31 assets in Germany and throughout Europe, from Warsaw to Edinburgh, and the sale of a total of 6 properties. The focus of these real estate transactions, both in Germany and internationally, was on office buildings. However, the transactions also included some mixed-use objects, such as retail and hotel properties. New real estate funds, specifically adapted to client requirements, such as the KanAm Grund Fokus Norddeutschland fund for institutional investors from the banking sector, were also launched. The KanAm Grund German Development Fonds, specializing in the particular category of real estate development projects, took off with a total of 6 projects in 2019. Furthermore, KanAm Grund Group was able to successfully implement prestigious projects for German and international real estate investors in Edinburgh and Munich.

As Investment and Asset Managers, KanAm Grund Group purchased the “Ludwig” building in Munich, with its landmark Ludwigstrasse 21 address, spanning 27,000 square meters of office space, for a Singapore based family office. In the Scottish capital Edinburgh, KanAm Grund Group acquired a modern property with office space, restaurants and retail outlet on behalf of a German pension fund for doctors, Aerzteversorgung Westfalen-Lippe. The 17,000 square meter property in a prime location on St Andrew Square has a BREEAM rating of excellent, certifying its environmental performance.

In the private investment business for LEADING CITIES INVEST, the 37 transactions this year included the acquisitions of the assets Prado in Marseille, Le Gallilée in Toulouse, Avenue Notre Dame in Nice, Renaissance in Warsaw and the European headquarters of Chiquita at Lake Geneva, as well as Liebigstrasse in Frankfurt. The LEADING CITIES INVEST public fund sold the Accor headquarters in Munich. This year, this first new generation open-end real estate fund has also pooled the energy supply for its buildings under a new framework agreement, enabling it to become carbon-neutral in covering its requirements for general electricity and gas. This first step translates into a reduction of CO2 emissions by 646 tons per year alongside cost savings. In order to further promote the sustainability of the LEADING CITIES INVEST, KanAm Grund Group's next step is to approach the tenants of their properties and encourage them to also move their existing energy supply to be more sustainable.

Most acquisitions, however, took place in the institutional sector and were made for banks, retirement and pension funds and family offices from both Germany and other countries. KanAm Grund Group made investments for institutional special funds in Paris, London, Edinburgh, Dublin, Marseille, Nice, Munich, Frankfurt, Hamburg and Wiesbaden. The KanAm Grund Group is currently serving institutional investors with a growing family of special funds (with one more about to be launched), both in line with German and Luxembourg laws as well as separate account mandates. The KanAm Grund Group thus covers a huge breadth of risk classes with funds following strategies from Core, Core Plus and Value Added to Opportunistic. More special AIFs are scheduled to be added to the offering.

Successful launch of new special funds
The "Fokus Norddeutschland Fonds", a new KanAm Grund Group special fund for institutional investors set up at the end of June, has started off immediately by purchasing its first property in Hamburg: A center providing local shops and amenities, called "Unser Viertel", loosely translated as "Our neighborhood", in the Volksdorf district. This multi-tenant property includes a supermarket, retail outlets, offices, doctors' surgeries and a municipal library, and stretches over an area of more than 5000 square meters.

The KanAm Grund Group German Development Fund, which was only launched in 2018, cooperated with well-established project developers, investing in living, student accommodation, serviced apartments and office properties. In its latest project, the fund acquired a large property at Augsburg Ladehofstrasse in September, where they want to build a new hotel and office building, including serviced apartments, retail and gastronomy outlets at the Augsburg central station. More of the 6 total projects are located in cities like Munich, Frankfurt and Esslingen.

Broad equity capital base and growth potential
There has been a clear broadening and diversification of the shareholder's equity base, thanks to the institutional funds business and so-called separate accounts. Depending on the group of investors, KanAm Grund Group now acquires large and small properties, with asset types ranging from office, retail and hotel to logistics, and risk profiles ranging from core to development. The needs and expectations of the Group's clients are also undergoing a transformation. Discretionary capital, i.e. capital from investors who desire no say in investment decisions, is becoming increasingly rare, with investors wishing to be involved in decision-making becoming the norm rather than an exception.

Since it was established, the KanAm Grund Group has handled a transaction volume of over 33 billion US dollars. Last year, 2018, alone saw 27 individual transactions concluded and 187 tenancy agreements extended, or, in the case of 76 of them, newly signed. In line with the new growth objectives, the number of highly qualified staff has also seen an increase of around 25 percent in 2018/2019. In investment management, fund management, institutional sales and also bookkeeping, finance and accounting, marketing and IT, staffing levels have been adjusted to lay the foundations for an increase in business transactions. In line with this growth strategy, the international real estate company has also signed a lease for a new home in the Frankfurt OMNITURM. The move to the Frankfurt banking district is scheduled for late 2020.

About the KanAm Grund Group
The KanAm Grund Group has handled a transaction volume of over 33 billion US dollars 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. The company is strategically organized into three business divisions under the umbrella of the KanAm Grund Group: KanAm Grund Kapitalverwaltungsgesellschaft (open-end real estate funds), KanAm Grund Institutional Kapitalverwaltungsgesellschaft (special real estate funds) and KanAm Grund REAM (international investment & asset management advisory). Since its strategic repositioning, KanAm Grund Group, as an international real estate enterprise, has provided real estate investment and asset management services to German private investors, institutional investors and international investors alike, irrespective of the investment vehicles involved.


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