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Further Berlin retail sale boosts Stenprop industrial transition

[Photo: Adam Vradenburg/Unsplash]

Munich based firm ILG Capital has paid UK property company Stenprop €30.8 million for its freehold interest in the Hermann Quartier shopping centre in Berlin.

Hermann Quartier is a covered retail centre with 8,274 sqm of gross lettable space, located above the Hermanstrasse S- and U-Bahn station. The weighted average rental is currently circa €15.20 per sq m.

The sale concludes Johannesburg- and London-listed Stenprop’s disposal of its food-led Berlin retail portfolio, and follows the sale of Neucӧlln Carrée retail park earlier this year and the recent exchange of contracts for the sale of the Victoria Centre.

The sales are part of Stenprop’s strategy to specialise entirely on multi-let industrial property which it plans to achieve by March 2022. The firm’s multi-let industrial assets are expected to rise to 72% of its total portfolio following these Berlin shopping centre sales. Net proceeds from the sale after transaction costs, repayment of debt and property taxes are expected to be €19 million with which Stenprop plans to fund further acquisitions in the MLI sector.

ILG Capital bought the centre on behalf of regulated special property fund ILG Einkaufen D, managed by IntReal International Real Estate.

Stenprop’s head of debt and special projects James Wakelin said that the disposal of the Berlin retail portfolio is a significant milestone towards the company’s transition to fully focused UK multi-let industrial REIT.

“Our MLI portfolio has performed well throughout the pandemic, providing further evidence of the resilience of the asset class. We look forward to putting the proceeds of this sale to work into our strong pipeline of opportunities as we remain on target to be 100% MLI by the end of the next financial year.”