CA Immobilien Anlagen : Immo acquires modern office building in Berlin

• CA Immo has acquired the 7,800 sqm 'Pohlstrasse 20' office building in central Berlin for c. € 47.35 m (c. € 6,100/sqm)
• High occupancy of 100% with major leases to high quality tenants including Thyssen Krupp Elevator and Bombardier
• Annual day one gross rental income of around € 1.3 m strengthens CA Immo's recurring earnings
• After stabilization of the underrented property, annual gross rental income expected to reach € 2.8 m
• Investment in Berlin, one of the most attractive office markets in Germany

Vienna/Berlin, March 11, 2021 - In an off market deal, CA Immo have signed and closed the acquisition of 'Pohlstrasse 20', a modern office building located in the prime Potsdamer Platz submarket in central Berlin. The property totals around 7,800 sqm lettable space and is fully let to high quality tenants such as Thyssen Krupp Elevator and Bombardier. The purchase price of € 47.35 m reflects a day one gross initial yield of 2.7 % on in place gross rental income of €1.3 m. With an average in place office rent of c. € 12.50/sqm, material rental reversion is expected to deliver in excess of a 5.5 % gross yield once stabilized.

Following the acquisition of the office building 'Am Karlsbad 11' in April 2020, and start of construction on the office building 'Grasblau' in February 2020, both located within the direct vicinity of 'Pohlstrasse 20', with this transaction, CA Immo takes another step in its core market expansion strategy and capital rotation program, setting the path for continued growth of recurring earnings while improving the underlying quality of the portfolio. As planned, the acquisition will contribute to CA Immo's recurring earnings (FFO) from the first quarter of 2021.

Keegan Viscius, Chief Investment Officer (CIO) of CA Immo: 'With the 'Pohlstrasse 20' office building we are buying a great asset in terms of quality, tenant covenant, and location, in one of the most attractive office submarkets in Berlin. With an existing footprint of four existing buildings and one under construction in the submarket, we have high conviction on our ability to capture rental reversion at this property given recent leasing experience in our existing portfolio (post-COVID) at rents more than double those currently in place at 'Pohlstrasse 20'. With an active asset management business plan to upgrade and modernize the property as leases roll, we benefit from the immediate rental income secured by high quality tenants and a low rent basis giving a large margin of safety.'

Christof Altendorfer, Head of Investment Management Germany and Managing Director Germany, adds: ''Pohlstrasse 20' is located in a submarket with resilient tenant demand and a strong upward trajectory in terms of attractiveness. Offering solid building quality, flexible floor plates in different sizes, and a green, leafy environment with outstanding connectivity in the heart of Berlin, 'Pohlstrasse 20' increases our footprint in one of our favorite office submarkets where we have continued to witness strong operational performance.'

'Pohlstrasse 20' - Investment Highlights

• Germany continues to be the safe haven market of Europe, with a resilient economic model and improving sentiment indicators. With a strong government fiscal position, fast action has been taken to implement support for the economy and employment, there is lots of headroom to invest and modernise the economy. Berlin continues to establish itself as one of the most attractive and dynamic real estate markets in Germany - despite the pandemic, investment activity has restarted and there are positive signals in relation to continued letting activity. Berlin has a diversified occupational base consisting of significant public sector demand, together with technology, medical/pharma, as well as service sector occupiers. The extremely low vacancy gives room for market softening before pressure is felt on rents, and the low overall occupational costs when compared to other European capitals (e.g. cost of labour, housing, office rent) gives the city an edge in terms of competitiveness.

• 'Pohlstrasse 20' occupies a prime position in the core South of Potsdamer Platz submarket in Berlin's Tiergarten District, one of the most rapidly developing Berlin office submarkets that has seen resilient and consistent office take up as well as a number of new developments. With significant investment in submarket infrastructure, and recent development of high quality residential and office space, the submarket has evolved into a dynamic environment for work, leisure, and living.

• Located on Pohlstrasse, a leafy green street with low car traffic connecting the increasingly popular high street Potsdamer Strasse where a wide array of retail and services can be found to the west, with the green urban park Gleisdreieck Park to the east, 'Pohlstrasse 20' is equidistant to two major U-Bahn stations, and has excellent public and private transportation access.

• 'Pohlstrasse 20' consists of 7,788 sqm lettable space (96% office) and 126 underground parking units. The property is 100% occupied by five tenants, with main tenants Bombardier and Thyssen Krupp Elevator making up for ca 80% of the occupied area. Remaining WAULT to lease end is 4.5 years.

Advisors to CA Immo were Poellath & Partner (legal), Mazars (tax & financial), CBRE (technical) and Cushman & Wakefield (commercial).