Swiss real estate company Corestate Group recently announced its purchase of a €230 million (USD $295.5 million) portfolio that includes 3,000 apartments located in Berlin, Germany, as well as an office building in Stuttgart.
The properties were purchased from a foreign investor who initially bought the portfolio when the German commercial real estate market was surging, the report noted. Specifically, the building in Stuttgart has a yield of 7.4 percent and is leased to the state of Baden Wurttemberg.
The transaction was noted to be very complex, due to the usual issues that affect both the German and European real estate markets, especially for banks involved, according to Phillip Burns, chief executive officer of Corestate.
"The restructuring of debt, dealing with the sensitivities and priorities of multiple lenders is highly complicated and something that we expect to see replicated in an increasing number of stressed situations over the next couple of years," Burns added.
The company added that it plans to take the excess capital in the portfolio to help improve the individual properties within it.
Corestate has partner offices throughout Europe including Essen, London, Luxembourg and Frankfurt.