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The Next German Property Market
At ProVenture Property, we are pleased to say that our analysis of various property markets across Germany has allowed us to work with our Clients to enter markets and to dispose of investments with a clear strategy. In short, we have made our Clients a lot of money over the last few years.
There is still some heat in the Germany Market and with many investors now looking to German Property – where should they invest?
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Berlin?
ProVenture were active in this market from 2006-2009. Market features which attracted us at the time were the low prices, different stage of the property cycle as to the rest of developed world, high levels of finance in place and steady rental demand.
The market entered a hold and then sell phase around 2012 when dramatic rental increases coupled with international money flooding in as the city was seen as a rare safe haven in the continuing Euro crisis pushed prices up. Price levels now seem out of sync with the local economy and wage levels and yields very low, but investors who did participate have done very well indeed during this period of recession in most countries.
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Single Apartment Example: Ritterstrasse, Berlin Kreuzberg
This 52 sqm apartment was bought in 2007 for 52.000 Euro with 70% finance [so 15.600 equity used plus 4.000 Eur costs, so 20.000 Euro total equity used].
Sold in 2011 for 102.000 Euro, giving a 50.000 Euro uplift, or a return on equity of around 325% over 4 years.
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Apartment House Example: Berlin- Friedrichshain
This property consisting of 20 Apartments was bought in 2007 for 875.000 Euro with 80% finance [so 175.000 Euro equity used plus 80.000 Eur costs, so 255.000 Euro total equity used].
Valued in 2013 for 2.1 million Euro, giving a 1,2 Million Euro uplift, or a return on equity of around 550% over 5 years.
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Leipzig?
This was a key market for ProVenture during the years after the global financial crisis, from 2007. Our activity continues in this market, primarily in the support of clients who are now selling their investments. We were attracted to the market for the reasons of very low prices and start of the property cycle and increasing population and developing economy which was as strong as anywhere in the East of the country. Prices developed from 2007-2013 very well, but are now at levels in most parts of the city which is not fully supported by local economics and is a good market to sell into as our clients now are.
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Apartment House Example: District of Schleussig
This property consisted of10 Units plus a rear building. It was marketed in 2008 for 560.000 Euro and then recently valued in 2013 for 1.1 Million Euro, giving over 500.000 Euro uplift, around a 100% increase.
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Wilhelmshaven – The next hot market?
As our travels continue to take us all over Germany, looking to bring you the best investments out there, so we have landed recently on the doorstep of a town called Wilhelmshaven, just a relative stone’s throw from our most successful market of 2012, Bremerhaven, again on Germany’s North Sea coast.
Wilhelmshaven has a great maritime history being inaugurated as the first German naval Port in 1869. It is still currently the largest site of the German Navy with 8,500 military and civilian employees in a city of 81,000 people. Big names supporting the civilian employment here are the French company Thales, who coincidentally just got the £600M contract for servicing all the British Royal Navy submarines over the next 10 years.
Our analysis is that this market is in the stealth phase and with yields currently available at over…read the full article on Wilhelmshaven
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PV569-Well maintained MFH in Wilhelmshaven
710,000€ |
Potential Yield: 10%
Type: Residential
Approx. Size: 1271 sqm
The property, built in 1963/4 and extensively refurbished in 2013 comprises of 14 residential and 4 commercial units, including 7 parking places. The refurbishment includes 11 of the 14 apartments and the communal areas. This modern, well maintained property is situated in the city centre, just 200m from the Town Hall.
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PV567 – Wilhelmshaven MFH in Good Location
515,000€ |
Potential Yield: 10%
Type: Residential
Approx. Size: 1077 sqm
The property was built in 1938/9 and was extensively refurbished in 2008. The refurbishment included new windows (80k) and complete refurbishment of the apartments (250k). This attractive corner property comprises of 14 units and is situated in the district of Bant, a quiet and green residential area, which is especially suitable for families. The proximity to down town, good infrastructure and sufficient green spaces make life here enjoyable for all generations.
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PV568 – Wilhelmshaven-AAA Mixed Use Property
2,400,000€ |
Potential Yield: 9.04%
Type: Residential
Approx. Size: 1633 sqm
The property was built in 1972/3 and is undergoing extensive refurbished which will be completed prior to sale. This includes a complete overhaul of all apartments, all with new bathrooms in each of the apartment and 3 commercial units. The 3 commercial units all have long leases and will extend at every available opportunity due to the property being located in the city centre pedestrian area. The location, based on the German Business Report ‘Capital’ and the German Property Guide ‘Plötz’, refer to it as “Core” and “5*” respectively.
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PV566 – Beautiful Modern MFH in Wilhelmshaven
650,000€ |
Potential Yield: 10.76%
Type: Residential
Approx. Size: 1295 sqm
The property was built in 1956/7 and was extensively refurbished in 2008/9. It is now in need of some minor decorative repairs and the vendor ensures to finish the works before completion of the contract. This beautiful comprised of 15 apartments, with 15 car parking spaces, all of which if fully rented. Each of the apartments is refurbished to a modern standard and come with a fitted kitchen. Most of the apartments also have a balcony.
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