COMMERCIAL PROPERTY MARKET GERMANY S TOP 7 CITIES 2018/Q1-4

Transcription

1 COMMERCIAL PROPERTY MARKET GERMANY S TOP 7 CITIES 2018/Q1-4

2 LOKALE LOCAL EXPERTISE KOMPETENZ ACROSS DEUTSCHLANDWEIT GERMANY MARKTBERICHT MARKET SURVEY /BÜROVERMIETUNG / 2018/Q /Q1-2 ABOUT US GERMAN PROPERTY PARTNERS Each of us being a leading commercial real estate company in its respective region, we have joined together to form a Germany-wide real estate network. We are five strong partners. In Northern Germany, Grossmann & Berger offers its real estate services out of its locations in and Berlin, while E & G Real Estate covers Southern Germany from its bases in Stuttgart and. ANTEON Immobilien is the firm to contact about property matters in and around Düsseldorf, while GREIF & CONTZEN Immobilien are your eyes and ears in the metropolitan area of Cologne and Bonn. blackolive guarantees full market coverage in the region. Partner Grossmann & Berger A real estate consultant with experience stretching back for over 80 years, Grossmann & Berger is one of the leading service providers for the sale and letting of commercial and residential real estate in Northern Germany, and is an affiliate in the HASPA-group of companies. blackolive blackolive is an owner-managed real estate consultancy firm that focuses on office letting and investment. The managing directors both have more than 26 years of experience and stand for an indepth understanding of the market. Anteon Anteon is an owner-managed real estate consultancy firm that specializes in brokering office lets, investments and industrial & logistics properties. In addition, as one of the market leaders, Anteon offers property marketing, project support and research services. E & G REAL ESTATE E & G is one of the leading providers of real estate services in South Germany and has many years experience in the fields of investment in commercial and residential properties and the commercial letting of office, retail, industrial or logistics premises. We have founded German Property Partners with the aim of providing our special services in all of Germany s major real estate centres. That way, whatever your commercial real estate requirements, wherever you are in Germany, you can obtain your advice from a single provider, and that is us. Via our network and thanks to our respective market positions, we can offer you outstanding local knowledge and preferential market access throughout Germany. The many years of service our employees have put in with us, make German Property Partners a reliable partner for long-term collaboration in the fields of commercial real estate and finance. GREIF & CONTZEN This owner-managed service company has been providing consultancy, evaluation, brokering and management services for commercial and residential properties in the metropolitan region of Cologne Bonn for over 40 years, and is experienced in the entire value chain of real estate transactions. GERMAN PROPERTY PARTNERS Dear Readers, Fresh superlatives were needed to describe the 2018 property market. At Germany s top 7 cities the volume of investment transactions was the highest in over ten years, totalling 36.7bn. The top 7 also continued to register great demand for office space, resulting in a respectable year-end total of 3.9m m². Too few properties to meet demand remains a constraint on the market. This shortage is reflected both in the average vacancy rates, which have fallen to an all-time low of 3.4% in these cities, and in the huge proportion of space in new developments that is let before completion. This market survey provides a review of the year 2018 as it played out on Germany s top 7 markets. In addition to drawing comparisons between the top 7 markets, we offer a detailed look at the investment and office letting markets in, Berlin, Düsseldorf, Cologne,, Stuttgart and. This survey includes a new section on the economic environment and one called Spotlight - in this edition we shall be shedding more light on the providers of coworking space. This market survey was made possible by the partnership between five of the leading service providers specialized in commercial properties based in north, central and south Germany - the nationwide network German Property Partners (GPP). Our detailed knowledge of local markets gives us access not only to data on the overall market, but also on each of the top 7 locations and the sub-markets within each of these. We hope you find the survey an informative and illuminating read. We would be happy to hold personal talks with you and answer your specific questions about property matters. Guido Nabben Spokesman for German Property Partners CONTENT Top 7 Overview and Key figures...4/5 Economic environment... 6 Spotlight: Coworking space... 7 Top 7 Investment...8/9 Top 7 Office letting...10/ /13 Berlin...14/15 Düsseldorf...16/17 Cologne...18/ /21 Stuttgart... 22/ /25 2 3

3 OVERVIEW TOP /Q1-4 KEY FIGURES TOP /Q1-4 Strong growth boosts transactions by 22% to 36.7bn Forward deals account for remarkable 18% Result betters previous record year of 2007 by almost 5.0bn Strong 4th quarter with transactions totalling 12.0bn Office letting 2018/Q1-4 Take- up of space [m²] Berlin Düsseldorf Cologne Stuttgart Top 7 590, , , , , , ,000 3,882,000 Year-on-year change [%] [net /m²/mth] Year-on-year change [%] [net /m²/mth] Year-on-year change [%] Vacant space [m²] 477, , , , , , ,000 3,046,800 Year-on-year change [%] Vacancy rate [%] Year-on-year change [percentage points (pp)] Completions [m²] , , , , , , ,000 2,222,000 Pre-let rate [%] Investment 2018/Q1-4 Transaction volume [ m] Berlin Düsseldorf Cologne Stuttgart Top 7 5,950 6,750 3,840 2,100 9,685 2,147 6,237 36,709 Year-on-year change [%] Share CBD [%] Share of foreign investors [%] Share of forward deals [%] Share of asset class Office [%] Prime yield Office [%] Year-on-year change [pp] Prime yield Commercial premises [%] Year-on-year change [pp] Prime yield Logistics [%] Take-up of office space, although considerable at 3.9m m², not on a par with the good result of 2017 Vacancy rate at new all-time low Take-up spurred by new build projects with high proportion of pre-letting rises in almost every top 7 city Year-on-year change [pp] HAMBURG 590,000 m² (-8 %) /m² (+6 %) /m² (+4 %) 3.5 % (-0.8 pp) 5.95bn (+65 %) 2.80 % (-0.1 pp) DÜSSELDORF 334,600 m² (-7 %) /m² (+2 %) /m² (+5 %) 7.6 % (-0.8 pp) 3.84bn (+30 %) 3.00 % (-0.4 pp) COLOGNE 310,000 m² (0 %) /m² (+7 %) /m² (+9 %) 2.6 % (-1.0 pp.) 2.10bn (-9 %) 3.30 % (-0.4 pp) STUTTGART 218,000 m² (-19 %) /m² (-5 %) /m² (+1 %) 2.3 % (-0.2 pp) 2.15bn (+79 %) 3.30 % (-0,2 pp) KEY FIGURES /: Take-up of space (year-on-year change) (year-on-year change) (year-on-year change) BERLIN 835,000 m² (-7 %) /m² (+12 %) /m² (+9 %) 1.8 % (-0.4 pp) 6.75bn (-8 %) 3.00 % (-0 pp) FRANKFURT 639,400 m² (-12 %) /m² (+9 %) /m² (-1 %) 7.4 % (-1.2 pp) 9.69bn (+42 %) 3.00 % (-0.3 pp) MUNICH 955,000 m² (+9 %) /m² (+5 %) /m² (+10 %) 1.8 % (-0,7 pp) 6.24bn (+6 %) 2.85 % (-0.15 pp) Vacancy rate (year-on-year change) Transaction volume (year-on-year ch.) Prime yield office (year-on-year ch.) 4 5

4 GERMANY BUSINESS ENVIRONMENT SPOTLIGHT COWORKING SPACE AND BUSINESS CENTRES In 2018 the German economy s growth rate was slower than in any of the past five years. Figures released by the Federal Statistics Office show that the gross domestic product (GDP) grew 1.5% in Since Germans are still happy to spend money and the labour market is booming, the economy has not faltered too much. However, foreign trade did not grow by as much as in prior years. Since the 3rd quarter Germany s economic upswing has cooled quite noticeably. Reasons include uncertainty caused by trade disagreements and the looming no-deal Brexit. LABOUR MARKET IN GERMANY In December 2018 the number of jobless people in Germany sank to 2.2m, its lowest post-reunification level. The unemployment rate in December 2018 was 4.9%, down by 0.4 percentage points from the same month of Despite the economic slowdown, the labour market has continued to progress well. The ifo employment barometer also indicates that more German companies wish to add to their payrolls. Having fallen back in the prior month, the barometer rose in December to reach points again. INTEREST RATES The European Central Bank continues, for the moment, to pursue a zero-interest policy. Experts do not expect to see a rise in the base rate before the beginning of It is highly probable that interest rates in the USA will be raised as planned. Following a rise at the start of 2018, 10-year Federal bonds fell back to 0.22% in January Mortgage rates usually track the changes in Federal bond rates. Accordingly, mortgage rates will not, in all likelihood, rise very much in Thus the cost of borrowing money for real estate remains at an all-time low. IFO SURVEY OF BUSINESS CONFIDENCE IN GERMANY According to the ifo index of business confidence, Germany s business managers are increasingly worried. The index of business confidence fell by 3.0 points between August and December, dropping to Business managers are now less satisfied with their current business situation too. Expectations about what the coming financial year will bring are also far less buoyant than in the summer of FORECAST GDP The major economic institutions in Germany forecast growth of 1.1% to 1.8% in It seems probable that the German economy s long period of growth is not yet over, but will proceed at a slower pace. The economy is benefiting from a flourishing construction industry and stable labour market, which is reflected in consumers great willingness to spend money. Uncertainties are created by the lack of clarity about how Great Britain plans to leave the EU and by the trade war between the USA and China. Year on year even more space was rented in 2018 by the providers of coworking space and business centres. Take-up in the top 7 cities was some 268,000 m², an increase of 28% compared with the prior year. This figure translates into 7% of the total amount of office space taken up over the year. PREFERRED LOCATIONS Providers of coworking space and business centres were most active in Berlin, where they rented 84,220 m², followed by (58,200 m²) and (45,500 m²). However, the biggest single let was agreed in Cologne. Design Offices took 13,000 m² in the city s DO-Haus. This segment took 93,900 m² in inner city areas and central business districts (CBDs) of the top 7 cities, 28% less than in the year before. Such figures reveal that the providers of flexible office space are now increasingly obliged to seek properties outside the centres, thus generating greater demand for premises in peripheral locations. Coworking space and business centre providers have exerted an enormous influence on demand for office premises in the top 7 cities. Rental agreements for more than 5,000 m² of space illustrate the massive expansion policies pursued by these companies. Design Offices, WeWork and Spaces (Regus) are the fastest growing players in the sector. Companies seeking offices find an already limited choice shrinking further as a result of leases signed by operators of coworking space and business centres. TOP 10 S TOP 7 CITIES 2018/Q1-4 Provider City Project/Property Design Offices Cologne DO-Haus Schanzenstrasse/Von-Sparr-Strasse rented space [ca. m²] 13,000 WeWork Arnulfstrasse 60 12,300 Spaces (Regus) Global Tower Neue Mainzer Strasse WeWork Berlin The Brighter Hub Warschauer Platz Design Offices Berlin Easton House Koppenstrasse 93 9,200 9,000 8,500 rent24 Berlin Karl-Liebknecht-Strasse 34 7,700 Spaces (Regus) The Office Group Design Offices Spaces (Regus) Omniturm Großer Gallusstrasse 16-1 Oper 46 Bockenheimer Anlage 46 Cologne Kaiser Hof Erftstrasse 19 6,500 6,500 5,600 Mühldorfstrasse 5,000 PROVIDERS OF FLEXIBLE OFFICE SPACE Business centres Target groups: companies, self-employed persons/freelancers Focus on private atmosphere (individual + group offices) Providers: Regus, Contora, Dussmann, etc. Coworking space Target groups: companies, self-employed persons/ freelancers, startups Focus on communication and collaboration, open spaces Providers: Beehive, Places, etc. Hyprid model: mix of business centre and coworking Target group: mix of the target groups for business centres and coworking space, corporates Mix of open space, individual + group offices Providers: Design Offices, WeWork, rent24, Spaces, Mindspace, etc. Employment /12 year end values in millions Ifo business climate Germany /12 Index 2015 = 100 Top 7 Take-up of space for coworking 2018/Q1-4 by locations Top 7 Take-up of space for coworking in 000s m 2 Unemployed Unemployment rate Registered job offers 6.9% 6.7% 6.4% 6.1% % % Business situation Business climate Business expectations Employment barometer Berlin Düsseldorf Cologne 4,100 18,000 27,400 Stuttgart 84,220 Share CBD Take-up of space 62% 35 % 31, % / ,500 58, % 86 % 19 % Source: Destatis, Bundesagentur für Arbeit Source: ifo Institut 6 7

5 TOP /Q was a new record year in terms of property investments in Germany s top 7 cities, with a total transaction volume of 36.7bn. This result bettered the previous record year of 2007 by almost 5.0bn. TRANSACTION VOLUME The transaction volume at four of Germany s top 7 cities showed double-digit growth rates. Stuttgart saw the greatest increase with a 79% rise ( 2.1bn) followed by (+ 65%, 5.95bn), (+42%, 9.7bn) and Düsseldorf (+30%, 3.8bn). was the front runner in terms of volume traded. In the 4th quarter alone, commercial properties changed hands for a total of 12.0bn. Forward deals accounted for a remarkable 18% of the total volume traded. Year on year their volume doubled to 6.6bn. Currently the market features a large number of properties in which space has already been let before completion. Investors are especially interested in these properties, causing the number of forward deals to rise appreciably during Comprising 67% of the volume traded in 2018, office properties remained the most sought-after asset class. Year on year the proportion of portfolio sales on the market fell from 23% to 16%. Amounting to a share virtually unchanged against 2017 (29%), 31% of the volume traded was located in the central business districts (CBDs) or inner cities. International investors accounted for about half (44%) of the volume sold in Year on year their share of the market fell by around 6 percentage points. Accounting for 60% and 51% respectively, this segment was most active in Berlin and. Six of the ten biggest transactions were completed by international players. Investors from Asian countries were much in evidence in. YIELDS The top 7 prime yields on office properties slipped back by 0.22 percentage points to 3.04%. In this sector the lowest prime yield was registered in, at 2.80%, the highest in Cologne and Stuttgart at 3.30%. Yields shrank most in Cologne and Düsseldorf, where returns fell by 0.40 percentage points. Commercial buildings and logistics properties also saw yields declining further year on year. The number of people in employment rose to record levels in 2018 and the economy is proving stable. In view of this, the outlook for the market in commercial property investment is set to remain healthy in However, as the supply of real estate is shrinking, no-one believes that quite such a good result will be returned in 2019 as in Overall we expect to see a year of solid investment activity similar to 2016/2017 and a closing transactions figure of around 29.0bn. TOP 10 TRANSACTIONS TOP 7 LOCATIONS 2018/Q1-4 City Project/Property Vendor Buyer Stuttgart Omniturm Große Gallusstrasse Trianon Mainzer Landstrasse Eurotower Kaiserstrasse 29 Administrative building Gutleutstrasse Springer Quartier (Sections A+B) Kaiser-Wilhelm-Strasse Junghof Plaza Junghofstrasse OSKAR Oskar-von-Miller-Ring 20 Gallileo Gallusanlage 7/Kaiserstrasse Allianz Campus Reinsburgstrasse Commerz Real for Hausinvest Igis Asset Management / Hanan Financial Investment Tishman Speyer Properties Deutschland GmbH Purchase price [ca. m] 700 NorthStar Realty Europe Corp. 650 Fubon Life Insurance IVG Institutional Funds (IVG IF) 530 Aroundtown Management company for professionals pensions, Hannover Triuva Kapitalverwaltungsgesellschaft mbh for providers of professional pensions Swiss Life / Bayerische Versorgungskammer Capital and Commercial Trust (CCT) Hines Interests Limited Partnership Wealthcap HFS Deutschland MOMENI / Black Horse Investments Joint Venture between PGIM Real Estate and FGI er Gewerbeimmobilien Joint Venture between Korean pensionsfunds and Hines Interests Limited Partnership Fund managed by Triuva for South Korean investor Officefirst (Blackstone Group) 340 Hanseviertel Große Bleichen 36 CBRE Global Investors for Europafonds Allianz Versicherung AG > 300 Top 7 Transaction volume Top 7 Strongest buyer groups by location 2018/Q1-4 Transaction volume in millions Top 7 Prime Yields Office / (Net) initial yield in % Top 7 Transaction volume 2018/Q1-4 by asset class ca. 29.4bn ,703 1,747 Specialist funds Open-end retail funds (real estate) Berlin Düsseldorf Cologne Stuttgart Other Logistics Undeveloped land Retail 8% 3% 5% 2% Berlin 1,638 Asset managers Commercial premises 8% Düsseldorf Stuttgart Listed property investment companies-ags/reits Asset managers Project developers Hotel 8% 67% Office Cologne 400 Specialist funds / 8 9

6 TOP / Q1-4 Although 2018 ended with a very respectable figure of 3.9m m², the top 7 cities reported slightly less office space taken up than in the outstanding year of At the close of the year 2018 a very satisfactory result was announced for Germany s top 7 office letting markets. The take-up of space was 3.9m m² and thus 5% less than the excellent result of the prior year. Take-up in the 4th quarter totalled 1.1m m². An aggravated shortage of properties and less space standing empty contributed to the slight fall. Once again led the way in terms of take-up (955,000 m², +9%), well ahead of Berlin (835,000 m², -7%) and (639,400 m², -12%). With office take-up of 310,000 m² Cologne equalled its result for the prior year. There was a slight year on year decline in take-up in (590,000 m², -8%) and Düsseldorf (334,600 m², -7%). As in the past, the highest premium rents were paid in at 43.50/m²/month, an increase of 9%. Rates rose more steeply in Berlin than in the other six cities, increasing by 12% to 33.50/m²/month. Only in Stuttgart did the premium rent fall, dropping 5% to 23.00/m²/month. Most average rents also increased, remaining relatively unchanged only in Stuttgart (+1%) and (-1%). Here the front-runner was Berlin with average rates of 21.30/m²/month, ahead of ( 20.00/m²/month) and ( 18.65/m²/month). The average vacancy rate across the top 7 cities fell to a record low of 3.4%. By the end of the year Berlin and had the lowest rates with a mere 1.8% of space standing empty. Year on year all top 7 cities report further shrinkage of the vacancy rate. The biggest contraction was 1.2 percentage points in, although its vacancy rate of 7.4% was the highest of all 7 cities apart from Düsseldorf. Taking all top 7 cities together, scheduled building completions will add 2.2m m² of office space in the years 2019/2020. Berlin takes the lion s share of building activity; here 843,000 m² of office space is due for completion by In and the amount is about half that of Berlin. Across the board, pre-letting rates are over 50%. The rate is highest in, where 90% of space is pre-let. This situation reflects the huge demand for office premises. The domestic economy remains on a firm footing in Germany, wages and employment rates are rising. It will not be possible to provide all potential customers with the space they need in 2019 due to the shortage of properties and the sky-high levels of off plan letting in new build developments. Against such a backdrop, one has to reckon with lower total take-up in 2019 than in An acute lack of suitable premises may lead to further rent rises in some cities. TOP S >10,000 m² TOP 7 LOCATIONS 2018/Q1-4 City Project/Property Tenant/Owner-occupier Stuttgart Düsseldorf Bregenzer/Steiermärker Strasse (Project development) Beiersdorf headquarters Troplowitzstrasse Campus One Einsteinring 30 icampus Friedenstrasse /Grafinger Strasse Cielo Theodor-Heuss-Allee Heinrich Campus Heinrich-Erhardt-Strasse 61 Robert Bosch GmbH (owner-occupier, construction start) Beiersdorf AG (owner-occupier, construction start) Rented space [ca. m²] 50,000 45,000 Wirecard AG 40,500 Serviceplan Gruppe 40,000 Commerzbank AG 36,100 Deloitte GmbH (Accountants/Auditors) 35,500 Berlin Hildegard-Knef-Platz 2 Vattenfall GmbH 29,000 Kustermannpark Balanstrasse Section 43 Europa-Allee 92 Agnes-Pockels-Bogen 1 HR Department of Bavarian state capital 25,000 er Allgemeine Zeitung GmbH (FAZ) 24,000 IT and Communications Technology Department of Bavarian state capital 23,000 Top 7 Take-up of space in millions m 2 incl. owner-occupiers Office letting Strongest industries by location 2018/Q1-4 Take-up of space in m 2 Top 7 Vacancy rate / in % Top 7 Completions Pre-let rate in 000s m 2 ca. 3.6m m² Berlin 195, ,000 Public administration/social services providers Public administration/social services providers Berlin Düsseldorf Cologne Stuttgart 80 Number of projects % Stuttgart 120,700 76,000 Financial Services Industry 7.6% 7.4% 73 % Düsseldorf 71,600 70,300 Internet/Media/Telecommunications Law firms/tax accountants 3.5% 2.6% 2.3% 1.8% ,303 1,462 Cologne 65,000 Public facilities, associations and federations /

7 HAMBURG HAMBURG 170 transactions were reported on the investment market for commercial properties in in 2018, setting a new record total of 5.95bn and overshooting the prior year s mark by 65%. PROPERTIES A large number of transactions for over 100m each are behind this exceptional year, unlike any experienced before in. 16 sales in all, totalling 2.7bn, fell into this category. In 2018 the biggest transaction posted was the sale of the Springer Quartier (Kaiser-Wilhelm-Strasse, City) for which some 400m was paid in the 1st quarter. The market was mainly dominated by single property sales, which accounted for 73% of total transactions. Forward deals amounting to 1.1bn comprised 19% of the total volume of transactions. This result is double the figure seen last year. In 2018 national investors featured most prominently on the market for investment in commercial properties in. A mere 26% ( 1.6m) of the investment trades originated abroad, mainly in the USA and Great Britain. Listed property investment AGs/REITS were the most active group of buyers in 2018, accounting for 15% of the total volume ( 881m). Two types of investor were most in evidence as vendors. Private equity funds/opportunity funds were behind 27% of the total traded ( 1.62bn). Here the primary reason was Blackstone s sale of its Officefirst portfolio. Developers formed the second largest group of vendors in 2018, with a share close to 27% ( 1.58bn). They are benefiting from the current high levels of demand for rental offices in new builds and the resultant early pre-letting agreements, which in turn leads to buildings being sold prior to completion. In 2019 there will still be demand for suitable investment properties in. The good market environment, ongoing low interest rates and the stability of the German economy are likely to ensure that business remains brisk in the year just started. However, the year 2019 is not expected to repeat the exceptional performance of 2018 and experts reckon with a total transaction volume of between 4.0bn and 4.5bn. Transaction volume ca. 4.3bn ,000 m² was the record result returned in 2017, and it could not be matched the following year. In the year 2018, 590,000 m² of space was was let or taken up by owner-occupiers and thus some 8% less than in Most of this reduction is attributable to the shortage of available properties Those occupiers of large suites of offices who decided on new locations in 2018 were increasingly likely to select premises off plan. Of 15 agreements signed for more than 5,000 m², eight related to new build developments. Overall in 2018 firms requiring over 5,000 m² of office space accounted for about 27% of total take-up. Beiersdorf was the front runner in this field, with the start of construction for their new 45,000 m² headquarters (Troplowitzstrasse, Eimsbüttel). As in the prior year, City ranked ahead of all other sub-markets in Some 127,700 m² or about 22% of the total take-up was transacted in s central sub-market. One reason for the high volume recorded in City was the successful letting of office space in the Tower am Michel (Ludwig-Erhard-Strasse 22), which was built some years ago. Year on year there has been a strong rise in both premium and average rents which have climbed to new record levels. By the end of 2018 the premium rent had reached 27.50/m²/month. During the same period average rents across the whole of rose to 15.80/m²/month. Numerous rental agreements in new builds or buildings with as-new space lay behind this growth. Take-up of space in 000s m² incl. owner-occupiers ca. 569,000 m² No improvement on the market for office space in was discernible by the close of the year. Although the vacancy rate fell no further than the prior quarter s 3.5%, the shortage of available space in some areas continued to curtail take-up activity. At the end of the 4th quarter some 477,000 m² of office space was available at short notice, 100,000 m² less than a year ago. Many new build projects due for completion as of 2021 will start to take more concrete shape during the course of the year, so that several large volume agreements may be expected. Overall, in view of the current availability of properties, a decline in take-up to 550,000 m² is expected. TOP 3 SUB-MARKETS (take-up of space / average rent) CITY / 127,700 m² / 20.20/m²/month CITY SOUTH / 98,600 m² / 13.00/m²/month HAMBURG EAST / 63,000 m² / 13.90/m²/month TOP 3 CONTRACTS 1. BEIERSDORF AG (OWNER-OCCUPIER, CONSTRUCTION START) Troplowitzstrasse / ca. 45,000 m² 2. POSTBANK Ipanema, Überseering 28 / ca. 13,800 m² 3. AKQUINET AG Bramfelder Chaussee / ca. 12,000 m² Premium and average rent / in /m²/mth (net) / 12 13

8 BERLIN BERLIN The volume of investment transactions in commercial properties fell by 8% year on year to a total for 2018 of 6.75bn. Nevertheless, it is the third-highest figure seen in the past ten years. PROPERTIES Some 110 commercial properties were sold in Berlin during In one of the three biggest agreements announced in Berlin, Aroundtown paid Park Hotels & Resorts some 297m for the Hilton Berlin (Gendarmenmarkt). In addition, the Zalando Campus (Valeska-Gert-Strasse 2) was sold again; this time L Etoile Properties and a South Korean pension fund managed by Capstone were paid 235m by a Hines-managed Luxembourg fund. The thirdbiggest transaction concerned a shopping centre, Das Schloss (Schloss Strasse 34), sold by HFS Immobilienfonds 10 to Deka Immobilien. As in previous years office properties were the dominant asset class on the market, accounting for a share of 57% (about 3.9bn); retail followed with 18% of the market (about 1.2bn) and hotels with about 8% ( 522m). The proportion of portfolio sales dropped appreciably from 32% to 18%. Forward deals comprised 20% of the market in 2018, slightly up from 17% in the prior year. Among property buyers, fund managers took the lion s share, closing 2018 with 24% of the total. Fund managers dominated the selling side of the equation too, accounting for 19% of the traded volume. The proportion of international investors fell slightly from 73% to 60%. The volume of transactions forecast for 2019 is around 5.5bn, because no-one expects to see the same level of big-ticket trades as Berlin Transaction volume ca. 6.2bn Year on year take-up of office space in Berlin contracted by 7%, although the final total of 835,000 m² was still the fourth-highest posted over the past ten years. A shortage of available properties rather than a lack of demand hampered the market. By the end of the year 37 agreements had been concluded for more than 5,000 m² of space and 15 for more than 10,000 m², including the Vattenfall lease (about 29,000 m², Hildegard-Knef-Platz 2, Periphery South) and a contract signed by Berlin Real Estate Management for the Berlin Landeskriminalamt (Office of Berlin State Criminal Police) for some 26,600 m² (Ringbahnstrasse , Periphery South). For the first time, the most popular sub-market was Charlottenburg with a share of some 15%, followed by Periphery South (about 14%) and Mitte (about 11%). Once again neither Mitte nor Mitte 1a was one of the top 2 sub-markets, thus underlining the shift in take-up locations. Accounting for 27% of total take-up of space, and repeating the prior year s pattern, the biggest single group of new occupiers were public administrative offices, associations and social facilities. Within the space of a year the average rent rose by 9% surpassing last year s record to set a new one at 21.30/m²/ month. The premium rent grew by 12% and its new level of 33.50/m²/month was last seen in the early 1990s. Empty space stood at a record low of 1.8% or 350,000 m², which was 19% below the level noted in the prior year. Berlin Take-up of space in 000s m² incl. owner-occupiers ca. 799,000 m² Berlin therefore has almost no space left to rent, which makes life very difficult for companies that wish to move premises or expand their offices. Many firms that need larger amounts of space are turning to new build developments. The result is a trend towards increased volumes of completions coupled with a high level of off plan lettings. Scheduled completions in 2019 total 338,500 m² of which 67% is pre-let, and in 2020 the projected figure is 504,500 m² (46% pre-let). The last time over 500,000 m² of new office space came onto the market was This tight market for space and consequent pressure on rents is not set to ease in the immediate future. In 2019 take-up is expected to total some 790,000 m² because so little space is available on the market. TOP 3 SUB-MARKETS (take-up of space / average rent) CHARLOTTENBURG / 116,900 m² / 19.50/m²/month PERIPHERY-SOUTH / 112,200 m² / 15.30/m²/month MITTE / 83,000 m² / 25.30/m²/month TOP 3 CONTRACTS 1. VATTENFALL GMBH Hildegard-Knef-Platz 2 / ca. 29,000 m² 2. BERLIN REAL ESTATE MANAGEMENT Ringbahnstrasse / ca. 26,000 m² 3. FEDERAL AGENCY FOR REAL ESTATE MANAGEMENT Spreestern, Salzufer 5 / ca. 15,000 m² Berlin Premium and average rent / in /m²/mth (net) The prime net yield on office properties remained unchanged year on year at an all-time low of a mere 3.00%. Commercial buildings produced a yield of only 2.90% / 14 15

9 DÜSSELDORF DÜSSELDORF 2018 closed with take-up of office space in Düsseldorf totalling 334,600 m². This figure is 7% below the prior year s when 358,700 m² of space was let. During the period under review the biggest rental agreement was signed by Deloitte GmbH for offices in the Heinrich Campus (about 35,500 m², Heinrich-Erhardt-Strasse 61, Kennedydamm/Derendorf); the second largest let was to NRW Bank in Herzogterrassen (7,735 m², Herzogstrasse 15, City) followed by IT.NRW (7,337 m², Kennedydamm 15-17, Kennedydamm/Derendorf). By the end of the year law firms/tax consultants/auditors had emerged as the biggest group of new tenants, taking some 70,300 m² of offices, followed by industrial and trading companies with about 39,800 m² and firms in the construction and real estate sector which rented around 35,200 m² of space and planned completions totalling 269,000 m² in 2019 and Clients are still seeking large premises and the signs are that the Düsseldorf office letting market will start the year 2019 well and a year-end total of 380,000 m² to 400,000 m² may be expected - especially as scheduled completions should add more space than in In view of considerable demand for space, it is quite possible that the premium rent will rise to 28.00/m²/month. A new record was set on the market for investments in commercial properties in Düsseldorf. Properties valued at some 3.8m were traded in The volume of transactions was thus 30% above the figure for the prior year, in which turnover of 3.0bn already marked a new high. PROPERTIES Three transactions at prices in excess of 200m contributed over 700m to this record total; these were the sale of the Metro headquarters (Metro-Strasse), of IKB headquarters (Wilhelm-Bötzkes-Strasse 1/Uerdinger Strasse 88-92) and the Stadttor office block (Stadttor 1). A total of some 90 transactions was posted for As in the past, office buildings remained the most popular asset class, accounting for 63% of the trading volume and a total of some 2.4bn. Retail properties were the next most-traded assets, with 9% of the market ( 345m), followed by hotels with 8% ( 324m). Portfolio sales contributed 25% to the final result. At the close of the year prime net yields on both office and retail properties were 3.0% (prior year: 3.40% and 3.50% respectively). Over the past twelve months prime net yields on logistics properties slipped from 4.75% to the current 4.35%. The most prominent vendors were project developers, whose turnover of 1.1bn translated into 30% of the market. Asset managers were the biggest buyers on the market, investing 755m or about a fifth of the total traded in International investors accounted for 39% of the market during the period under review. Demand will remain high but fewer properties are likely to come onto the market. Therefore the outlook for the property investment business in Düsseldorf is basically positive but with no reason for euphoria. Since the year has started with a well-filled pipeline of trades, 2019 is forecast to close with a transaction total of 3.0bn, on a par with Düsseldorf Transaction volume ca. 2.8bn As a result, above all, of lettings in newly built properties or off plan agreements, the average rent rose to 16.10/m²/ month, a year on year increase of about 5%. At the close of the year the premium rent was 27.50/m²/month. This is a year on year rise of 2%. Primary causes of this increase were lets in development projects in the Königsallee/ Bankenviertel sub-market. Empty space stood at a record low of 550,000 m² or 7.6% of total stock. Year on year vacancies dropped by 12%. However, during the same period the stock of office space also fell by 3% to the current figure of 7,320,000 m². This was offset by 103,000 m² of newly completed offices in Düsseldorf Take-up of space in 000s m² incl. owner-occupiers ca. 336,420 m² TOP 3 SUB-MARKETS (take-up of space / average rent) KENNEDYDAMM/DERENDORF / 80,200 m² / 19.50/m²/month CITY / 71,800 m² / 17.00/m²/month AIRPORT CITY/NORTH / 47,000 m² / 15.70/m²/month TOP 3 CONTRACTS 1. DELOITTE GMBH (ACCOUNTANTS/AUDITORS) Heinrich Campus, Heinrich-Erhardt-Strasse 61 / ca. 35,500 m² 2. NRW BANK Herzogterrassen, Herzogstrasse 15 / ca. 7,735 m² 3. IT. NRW Kennedydamm / ca. 7,337 m² Düsseldorf Premium and average rent / in /m²/mth (net) / 16 17

10 COLOGNE COLOGNE In 2018 total turnover of space was some 310,000 m². This result equals that of The market was chiefly marked by shrinking amounts of empty space and rising rents. Due to the shortage of space in existing buildings many firms requiring large amounts of space opted for new build developments. Two of the biggest rental agreements were signed for premises located in the I/D Cologne development district in Mühlheim sub-market, where Design Offices took 13,000 m² ( DO-Haus, Schanzenstrasse / Von Sparr-Strasse, Mühlheim) and Siemens some 10,000 m² ( Haus am Platz, Schanzenstrasse/Von-Sparr-Strasse, Mühlheim). In the banking district the tax and finance office of North Rhine-Westphalia (Oberfinanzdirection) rented some 10,600 m² in the Dominium, a premium office block at Unter Sachsenhausen Only about 200,000 m² of office space remains empty, equivalent to some 2.6% of the total stock. In the city centre alone, vacancies have shrunk by nearly 40,000 m², or 37%. Only some 50,000 m² of office space was completed in In 2019 the total is likely to be 140,000 m², however less than 20% of this space is still available to rent. Because the economy has slowed and very little space is available at short notice, the take-up of space in 2019 is likely to be lower than it was last year. Overall, annual total take-up of 280,000 m² seems a probable result. In 2018 the volume of investment transactions in commercial properties in Cologne totalled some 2.1bn. This result was the second highest seen for many years and, due to a lower number of available properties, was only about 200m short of the record set in PROPERTIES One of the biggest transactions was the sale of department store Kaufhof (Hohe Strasse 43-51, corner of Schildergasse) to Signa. The purchase price was thought to be over 150m. This big-ticket purchase was the major reason why retail properties accounted for 13% of the total traded. Several hotel facilities were sold, for example the Maritim (Heumarkt 20) and accordingly this segment of the market comprised about 20% of investment trades. Office properties made up around 52% of the investment tally, topping the list by a relatively low margin. Year on year prime net yields have slipped further back. In the case of commercial buildings and offices, however, the decline has slowed over the course of the year. The prime net yield on commercial buildings was 2.90%, and fell to 3.30% on offices. Yields on these two classes of asset are tending towards convergence. The biggest decline was noted for logistics properties, which slipped from 4.70% in the 4th quarter of 2017 to a current rate of 4.20%. Specialist funds were the most active group of buyers, accounting for about 19% of investment trading. Developers were the largest group of vendors, comprising about 23% of the market. Several developers were able to benefit from investors considerable willingness to enter into forward deals, which comprised some 18% of the total. Overseas investors secured a little over a quarter of the volume traded. Investors continue to wish to buy into real estate and there is an ongoing lack of alternative investments. As long as interest rates and loan terms remain so reasonable, properties that come onto the market in the next few months will be in great demand and investors will be willing to spend money on them. If the right properties are available on the market, it may be possible to close the year with a result of some 2.0bn. Cologne Transaction volume ca. 1.9bn ,0 Government departments and various associations accounted for around 21% of overall take-up, renting several large and a number of smaller office suites. Providers of coworking space and business centres rented 31,000 m² and thus increased their share of turnover from 4% in 2017 to around 10% last year. Landlords were well placed to demand higher rentals. The average weighted rent rose by about 9% during the year to around 15.00/m²/month. The average rent rose by 7% to 23.00/m²/month. The top rent paid was about 25.00/m²/ month. Cologne Take-up of space in 000s m² incl. owner-occupiers ca. 322,000 m² TOP 3 SUB-MARKETS (take-up of space / average rent) CBD NORTH / 50,000 m² / 16.00/m²/month COLOGNE NORTH / 30,000 m² / 12.90/m²/month COLOGNE RING ROAD / 21,000 m² / 15.20/m²/month TOP 3 CONTRACTS 1. DESIGN OFFICES GMBH DO-Haus, Schanzenstrasse / ca. 13,000 m² 2. TAX AND FINANCE OFFICE OF NORTH RHINE-WESTPHALIA Dominium, Unter Sachsenhausen / ca. 10,600 m² 3. SIEMENS AG Haus am Platz, Schanzenstrasse / ca. 10,100 m² Cologne Premium and average rent / in /m²/mth (net) / 18 19

11 FRANKFURT FRANKFURT In 2018 property investment transactions in totalled some 9.7bn; this figure is 42% higher than the result for 2017 and breaks the record set in 2007 (> 8.0bn). PROPERTIES The biggest trade in 2018 was the sale of the Omniturm (Grosse Gallusstrasse 16-18) for which CommerzReal paid Tishman Speyer some 700m. In a similar price category, NorthStar sold the Trianon (Mainzer Landstrasse 16-24) to IGIS/Hana Financial Investment, a South Korea consortium, for some 650m. Largely due to the sale of many big-ticket high-rise buildings, office property assets accounted for 86% of the total trading volume. Seven forward deals at prices in excess of 100m added up to over 2.7bn or 27% of the total volume traded. The fact that a greater proportion of properties change hands before construction work is completed is indicative of the growing shortage of available real estate. investors were involved in a number of the top-priced transactions and their share of the total volume traded was thus more than 50%. Considering the decimated selection of available properties, the transaction volume in 2019 will not go beyond the figure posted in Demand remains unabated, and in 2019 will remain a major investment magnet attracting both national and international players. In the coming year investors will continue to prefer core plus and value add properties in top locations to real estate in B and C towns. Transaction volume Although 12% less space was let in 2018 than in the prior year, the final result of some 639,400 m² was nevertheless appreciably higher than the five-year average of about 537,000 m². The biggest let of the year concerned 36,100 m² in the Cielo (Theodor-Heuss-Allee , City West) taken by Commerzbank in the 3rd quarter. Second place went to the FAZ, a newspaper, which took close to 24,000 m² off plan (Europa-Allee 92). Deloitte, a financial consultancy and accounting firm, chose some 15,800 m² in the Zebra (Europa-Allee 91-93, City Rand). The banking district (Bankenviertel) sub-market reported most demand (17%) followed by City Rand (16%) where the two off-plan lets in the Europaviertel section of this sub-market were posted. Providers of financial services rented more space than other groups (19%) in the banking metropolis of. Partly due to the agreement signed by the FAZ, companies from the internet/media/telecoms sector placed second (15%). They were closely followed by providers of construction and property services (14%) fuelled by the ongoing strength of demand for coworking space. Because all new lets involving more than 10,000 m² were located outside the CBD, the average rent fell 1% to 20.00/m²/month. However, the premium rent climbed 9% to 43.50/m²/month due to a number of rental agreements for space in prime tower blocks such as the Omniturm and the TaunusTurm. Take-up of space in 000s m² incl. owner-occupiers The vacancy rate fell by a further 1.2 percentage points to 7.4% and a growing shortage is becoming noticeable in certain locations (CBD). Very little new build space has come onto the market in recent years - a mere 88,000 m² in but from 2019 onwards more new buildings will be completed, adding around 170,000 m² in 2019 and over 300,000 m² in 2020, although 65% (2019) and close to 50% (2020) of this space has been pre-let. Demand for offices in will remain high in However, in view of the shortage of available space, take-up for the year will probably be between 500,000 m² and 550,000 m². This in turn could lead to higher rents in all parts of the city and a further modest reduction in the amount of empty space. TOP 3 SUB-MARKETS (take-up of space / average rent) BANKING DISTRICT / 108,500 m² / 31.20/m²/month CITY RAND / 100,300 m² / 20.10/m²/month CITY / 62,800 m² / 19.10/m²/month TOP 3 CONTRACTS 1. COMMERZBANK AG Cielo, Theodor-Heuss-Allee / ca. 36,100 m² 2. FRANKFURTER ALLGEMEINE ZEITUNG (FAZ) Europa-Allee 92 / ca. 24,000 m² 3. DELOITTE GMBH (ACCOUNTANTS/AUDITORS) Zebra, Europa-Allee / ca. 15,800 m² Premium and average rent / in /m²/mth (net) The market share of portfolio sales, which declined from 26% in 2016 to 12% in 2017, fell to 8% in Because core properties accounted for 63% of the total in 2018, the prime net yield on office real estate dropped back 0.3 percentage points to 3.00%. There was also brisk demand for core plus and value add properties, with 50 transactions in this sector. ca. 6.8bn ca. 537,000 m² Open property mutual funds were the buyers in the two largest transactions, so that their share of the total volume traded was a top-ranking 18%. On the selling side, developers took the largest share of the market by number of trades (22) and volume generated (24%); this also reflects the greater number of forward deals. International / 20 21

12 STUTTGART STUTTGART Investments in commercial properties in Stuttgart reached a new record total of 2.1bn in Year on year the volume of transactions grew by 79% or 950m, soaring past the previous best mark set in PROPERTIES This high volume of transactions was attributable to the sale of the SI Centre in Möhringen and of the Alte Bahn direktion in the city centre during the 1st half year; likewise to CommerzReal s 3rd-quarter purchase of the Uhland Carré in the Uhlandstrasse district and, in the last quarter of the year, the sale of the Allianz Campus on Reinsburgstrasse, which was acquired by Hines. These four transactions accounted for some 820m in total. Investors focussed on office buildings which - partly a result of the sale of the Uhland Carré and the Allianz Campus - comprised some 60% of the volume traded, followed by mixed use properties with a share of about 17% of the market. Forward deals constituted around 10% of the volume traded and portfolio transactions made up some 7%. The prime net yield on office assets was 3.30%, having dropped 0.2 percentage points from its level in the prior year. The statistics show a prime net yield on commercial buildings of 2.80% and 4.50% on logistics properties. Comprising around 29% of the total, developers were the predominant buyers. Open property mutual funds followed with 18% of the market and specialist funds with 15%. All other groups of investors took less than 10% of the market and thus played only a minor role. Private equity/ opportunity funds comprised the single biggest group of vendors, with a 26% share of the volume of transactions, followed by developers with a share of 20%. Compared with last year, the proportion of overseas buyers on the market has contracted a little. These investors accounted for some 39% in Several more big-ticket transactions involving commercial properties in Stuttgart are in the pipeline for However, due to the short supply of properties for sale, the final transaction volume is expected to be about 1.75bn and thus lower than the result for Stuttgart Transaction volume ca. 1.6bn In Stuttgart the year 2018 closed with total take-up of office space standing at some 218,000 m². The annual result was thus 19% below the prior year and 15% lower than the ten-year average. Four owner-occupier agreements totalling some 67,000 m² made a crucial contribution to the overall result. Stuttgart-Feuerbach sub-market posted the highest take-up of space at 54,600 m², almost entirely due to the 50,000 m² of space occupied by the Robert Bosch GmbH project, which was also the biggest contract signed in 2018 in Stuttgart. Bad Cannstatt sub-market placed second with a total of some 34,500 m². Stuttgart city centre followed with some 28,400 m². Here the state government of Baden-Württemberg purchased a building offering 10,800 m² of space in Kriegbergstrasse. The biggest rental agreement was one for 8,800 m² of space in a building located in Leinfelden-Echterdingen, likewise signed by the state government of Baden-Württemberg. Industrial firms accounted for some 76,000 m² of take-up, more than any other sector of the economy. At the close of the year the premium rent in Stuttgart was 23.00/m²/month. Year on year this translates into a 5% drop and a return to levels posted in The average rent for the entire city area including Leinfelden-Echterdingen was about 13.90/m²/month, around 1% more than the figure for Stuttgart Take-up of space in 000s m² incl. owner-occupiers ca. 297,600 m² By the end of the year 2018 the vacancy rate was 2.3%. Year on year the amount of available space rose by 11% to 186,000 m² of office premises. Remedies are not immediately in sight. In 2018 new-builds added some 92,800 m² to the total, in 2019 around 89,700 m² will be completed. However, only about 25,400 m² of this space (28%) will come onto the market. As in recent years, those looking for large premises have no alternative but to choose peripheral locations. Over the next three years practically no new-build space will come onto the Stuttgart City and city centre sub-markets. Take-up in 2019 will probably be on a par with 2018, meaning turnover of between 210,000 m² and 230,000 m². TOP 3 SUB-MARKETS (take-up of space / average rent) FEUERBACH/ZUFFENH. / 54,600 m² / 11.70/m²/month BAD CANNSTATT / 34,500 m² / 14.10/m²/month CITY CENTRE / 28,400 m² / 11.90/m²/month TOP 3 CONTRACTS 1. ROBERT BOSCH GMBH (OWNER-OCCUPIER) Bregenzer-/Steiermärker Strasse / ca. 50,000 m² 2. STATE GOV. OF BADEN-WÜRTTEMBERG (OWNER-OCCUPIER) Kriegsbergstrasse 32 / ca. 10,800 m² 3. STATE GOVERNMENT OF BADEN-WÜRTTEMBERG Fasanenweg / ca. 8,800 m² Stuttgart Premium and average rent / in /m²/mth (net) / 22 23

13 MUNICH MUNICH In 2018 the transaction volume on the market for investments in commercial properties in totalled about 6.2bn. This is both an outstandingly good result and a year on year rise of 6%. 16 transactions with price tags of 100m and higher together accounted for about 50% of total turnover. PROPERTIES Once again the most-sought-after assets were office properties, which made up 68% of the total market ( 4.3bn). Most activity was recorded in the 1st and 4th quarters, in each of which property trades totalled about 2.0bn. Among the biggest transactions of the year were the sale of OSKAR (Oskar-von-Miller-Ring 20) bought in the 4th quarter by a consortium of BVK and Swiss Life for some 390m, and the sale of Correo Quartier by the main station for which Credit Suisse paid Postbank around 275m. Although trailing a long way behind, hotels ( 673m) were the second most popular assets, followed in third place by mixed use properties ( 485m). The prime net yield on office properties was further squeezed over the course of the year and closed at 2.85%. It is not to be expected that yields will decline any further in 2019; at least as far as core locations are concerned, the bottom has been reached. In 2018 capital spending on properties in was divided 40:60 between foreign and domestic investors. Most overseas investment capital came from the USA, Great Britain and Asian countries. Samsung Asset Management from South Korea bought the Atrium in north for around 180m. Prominent buyers were, once again, national and international funds, increasingly acting through their asset managers. Their share of trading amounted to around 3.5bn. Sustained interest in commercial properties will continue to encourage investors to buy real estate in A dramatic worsening of the market is not to be expected. Whether and in what manner the reduced growth forecasts for the euro zone as a consequence of a slowing global economy and the imminent Brexit will have an effect will become clear during the course of the year. The first quarters of the new year are already looking to generate a respectable trading volume. A total volume of between 5.75bn and 6.25bn is forecast for the year overall. Transaction volume ca. 5.8bn Posting take-up of 955,000 m², the second highest result since the early 2000s, office market remains at giddy heights reminiscent of the New Economy era. The biggest rental agreement of 2018 was signed by Wirecard AG (40,500 m², Einsteinring 30, East Envrions) which opted off plan for space in Campus One in Aschheim; close behind was a contract signed off plan by Serviceplan Gruppe for space in the icampus on the Werksviertel site by East Station (40,000 m², Friedenstrasse/Grafinger Strasse, Centre East). Following in third place, the HR department of Bavarian state capital took 25,000 m² (Balandstrasse 55-59, Centre East). Altogether 15 lets for more than 10,000 m² were reported. During the year just ended City East sub-market squeezed into first place with a letting volume of around 122,000 m² (12%). This is not very surprising, because at present most new developments are being planned in this district. The second busiest sub-market was City North with take-up of 111,000 m² (11%). Third place went to Centre East submarket (108,000 m², 11%). Once again, the public purse absorbed a larger amount of space than any other sector, but IT firms were also very keen to expand premises in The average rent was 18.65/m²/month in 2018, a year on year rise of 10%. The premium rent increased by 5% to 36.80/m²/month. Take-up of space in 000s m² incl. owner-occupiers ca. 787,000 m² Currently some 420,000 m² of office space is available to rent. This is equivalent to a vacancy rate of 1.8%, a year on year reduction of 0.7 percentage points. Around 200,000 m² of new office space was completed in 2018, almost all of which has been let. Projected completions in 2019 total around 300,000 m². Here too, a large proportion of space has been pre-let. Unabated high demand for office space is forecast for the year The trend towards renting off plan in buildings that are a few years away from completion is set to continue. Due to the shortage of available space, letting activity is expected to reach between 800,000 m² and 850,000 m². TOP 3 SUB-MARKETS (take-up of space / average rent) CITY EAST / 122,000 m² / 16.50/m²/month CITY NORTH / 111,000 m² / 17.50/m²/month DOWNTOWN EAST / 108,000 m² / 22.00/m²/month TOP 3 CONTRACTS 1. WIRECARD AG Campus One, Einsteinring 30 / ca. 40,500 m² 2. SERVICEPLAN GRUPPE icampus, Friedenstrasse/Grafinger Strasse / ca. 40,000 m² 3. HR DEPARTMENT OF BAVARIAN STATE CAPITAL MUNICH Balanstrasse / ca. 25,000 m² Premium and average rent / in /m²/mth (net) / 24 25

14 LOKALE LOCAL EXPERTISE KOMPETENZ ACROSS DEUTSCHLANDWEIT GERMANY GLOSSARY GERMAN PROPERTY PARTNERS Across Germany Services Take-up of space is the total of all space let plus that sold to, or finished by or for an owner-occupier during the period under review. The operative date for inclusion in the statistic is the date on which the lease or purchase agreement was signed. Lease renewals are not counted as take-up. Areas are stated on the basis of the guide for calculating the rental area in commercial leases (MF/G). PREMIUM RENT The premium rent relates to the top 3 % of the market for new lets (not counting owner-occupiers) during the 12 months just ended and is stated as the average of such rents. AVERAGE RENT The average rent is calculated by taking the individual rents agreed in all leases signed over the past 12 months, weighting them by the amount of space rented and computing the mean value. Figures refer to nominal net rents ex services. VACANCIES Vacancies include all office space that is available to new tenants within three months. Sub-let space is counted as vacancy. TRANSACTION VOLUME The transaction volume is the sum of the purchase prices of all commercial property sold in Germany s top 7 markets during the period under review. The date of signing determines when a transaction is included in the statistics. Buy to let investments in residential properties are not included in the transaction volume. SERVICES GERMAN PROPERTY PARTNERS Naturally enough, when doing real estate business in Germany, you would like to work with a partner who can provide you with expert professional support in all issues relating to commercial property. Our spectrum of services covers both real estate investments and commercial letting. We are conversant with all risk classes and types of property. For investors we offer a Germany-wide service extending to the purchase and sale of office, hotel, warehousing, logistics and retail real estate, as well as apartment buildings, either as individual properties or in portfolios. We are also ready to support you with preparation for development projects. ASSET CLASS A property is allocated to an asset class according to the predominant way in which space is used (at least 75%) when the contract is signed. If at least 75% of a property is not used in one single way, it is classified as mixed use. INDIVIDUAL PROPERTIES AND PORTFOLIO TRANSACTIONS An individual property transaction means the purchase of a building used for commercial purposes or of a piece of land for development. Portfolio transactions involve the purchase of at least two separate properties in different locations. PRIME YIELDS The prime yield is the initial return attainable on a property that has been let on normal market terms (tenants with good credit ratings), has top quality structure and fit-out and stands in one of the very best locations. It is stated as the net initial yield in per cent, i.e. the ratio between the annual rental income less nonapportionable ancillary costs and the gross purchase price (net purchase price plus land acquisition tax, notary s fees and agency commission.) TYPES OF Investors (buyers) and vendors are differentiated using the guide to reporting types of investor in commercial properties (Leitfaden zur Berichterstattung über den Investmentmarkt für Gewerbeimmobilien, May 2014) compiled by the gif research experts. SHARE DEAL A share deal is the acquisition of shares in a real estate or property firm. The primary motive for the investment is purchase of the property. The size of the shareholding acquired is irrelevant to its inclusion as property transaction. Due to the banking background of two of our partners, we are familiar with the workings of the financial industry. We are also well placed to assist you in your search for office, retail, industrial, warehousing and logistics premises, as well as special uses, in the process bringing to bear our indepth local knowledge and outstanding regional contacts. In addition, we offer you corporate real estate management, as well as research tailored to your specific project. Further services in the fields of finance, fund management, asset management and administration mean that you can obtain everything needed from us to secure the effective long-term advancement of your project. Berlin Düsseldorf Cologne Bonn Stuttgart We draw your attention to the fact that all statements made here are non-binding. Most of the information is based on third-party reports. The sole intention of this market survey is to provide general information for our clients. Grossmann & Berger GmbH Immobiliendienstleister Bleichenbrücke 9 (Bleichenhof) D Phone: +49 (0)40 / Fax: +49 (0)40 / info@grossmann-berger.de Managing directors: Holger Michaelis, Andreas Rehberg, Lars Seidel, Axel Steinbrinker Chairman of the Supervisory Board: Frank Brockmann Entered in the commercial register: B Supervisory authority: Borough Council -Mitte, Department of Consumer Protection, Commerce and the Environment, Klosterwall 2, VAT identification number pursuant to Section 27a German Turnover Tax law: DE Anteon Immobilien GmbH & Co. KG Ernst-Schneider-Platz 1 D Düsseldorf Phone: +49 (0)211 / Fax: +49 (0)211 / immobilien@anteon.de Managing partners: Guido Nabben, Heiko Piekarski, Jens Reich, Dirk Schäfer, Marius Varro Trading licence: a licence pursuant to Section 34 c of the German Industrial Code/GewO was granted with no restrictions by the Municipal Government of the State Capital Düsseldorf, Department 32, Tel.: +49 (0)211 / ANTEON Immobilien GmbH & Co. KG Registered office in Düsseldorf, entered in the Commercial Register of Düsseldorf under HRA General Partner ANTEON Verwaltungsgesellschaft mbh, registered office in Düsseldorf, entered in the Commercial Register of Düsseldorf under HRB VAT identification number pursuant to Section 27a German Turnover Tax law: DE Greif & Contzen Immobilien GmbH Pferdmengesstrasse 42 D Köln Phone: +49 (0)221 / Fax: +49 (0)221 / gpp@greif-contzen.de Managing directors: Mr Theodor J. Greif, Rainer Krauß Amtsgericht (lower court) Registered in: Cologne, Company Register no Supervisory authority: City of Cologne, Ordnungsamt, P.O. Box , Köln VAT identification number pursuant to Section 27a German Turnover Tax law: DE Real estate investments Commercial letting Corporate real estate management (CREM) Research Banking and financing services Equity financing of development projects Fund and asset management Real estate management Real estate valuation Agriculture and forestry real estate blackolive advisors GmbH Reuterweg 18 D Phone: +49 (0)69 / Fax +49 (0)69 / gpp@blackolive.de Managing directors: Oliver Schön, Rainer Hamacher Trading licence: a licence pursuant to Section 34 c issued by the Ordnungsamt Competent supervisory authority: Gewerbe- und Ordnungsamt, Kleyerstrasse 86, am Main Commercial register and no. of entry: Registered in (Amtsgericht), HRB VAT identification number pursuant to Section 27a German Turnover Tax law: DE E & G Real Estate GmbH Börsenplatz 1 D Stuttgart Phone: +49 (0)711 / Fax +49 (0)711 / gpp@eug-re.de Managing directors: Mario Caroli, Björn Holzwarth Competent supervisory authority: Amt für öffentliche Ordnung, Gewerbe- und Gaststättenbehörde, Eberhardstrasse 37, Stuttgart Commercial register and no. of entry: Registered in Stuttgart (Amtsgericht) HRB Responsible under Section 55 par. 2 of the Interstate Broadcasting Agreement (RStV): Björn Holzwarth, managing director VAT identification number pursuant to Section 27a German Turnover Tax law: DE

15 LOKALE LOCAL EXPERTISE KOMPETENZ ACROSS DEUTSCHLANDWEIT GERMANY Contact Grossmann & Berger GmbH Locations:, Berlin Bleichenbrücke 9 (Stadthöfe) D Phone: +49 (0)40 / Fax: +49 (0)40 / Mail: gpp@grossmann-berger.de blackolive advisors GmbH Location: Reuterweg 18 D Phone: +49 (0)69 / Fax: +49 (0)69 / Mail: gpp@blackolive.de Anteon Immobilien GmbH & Co. KG Location: Düsseldorf Ernst-Schneider-Platz 1 D Düsseldorf Phone: +49 (0)211 / Fax: +49 (0)211 / Mail: gpp@anteon.de E & G Real Estate GmbH Locations: Stuttgart, Börsenplatz 1 D Stuttgart Phone: +49 (0)711 / Phone: +49 (0)89 / Mail: gpp@eug-re.de GREIF & CONTZEN Immobilien GmbH Location: Cologne Bonn Pferdmengesstrasse 42 D Köln Phone: +49 (0)221 / Fax: +49 (0)221 / Mail: gpp@greif-contzen.de Photo credits: Cover, page 24: E & G Real Estate GmbH; page 3: Anteon Immobilien GmbH; page 2, 8, 11, 15, 17: Fotolia; page 13, 19, 21, 23: Shutterstock