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‘Corestate Bank’ backs one of top German deals of the year

In what is one of the largest property deals in Germany this year, Aggregate Holdings has acquired the Fürst Project on Berlin’s Kurfürstendamm. The acquisition and development is being funded for €1.02 billion, although the actual purchase price is not being disclosed.

A subsidiary of Corestate, Aggregate Financial Services (AFS) which Corestate acquired two weeks ago and which will operate as Corestate Bank in future, is financing the transaction. AFS structured and placed the financing as the sole global coordinator and sole agent.

Located on the site of the Ku’damm-Karree at Kurfürstendamm 206–209, on one of Berlin’s busiest streets, the project has a gross construction area of approximately 183,000 sq m about 60% of which will be office and co-working space with the remaining area allocated for leisure, retail and a hotel.

Completed value expected to be €2.5bn

The project, which is being undertaken by Cells Group, is expected to be worth €2.5 billion when complete and the expected rental income is €50 million per year. On completion, the total debt related to the project is expected to be around €1.25 billion.

Over 30% of the total capital expenditure has already taken place, over 20% of the project is completed, and the first tenants have moved in and are paying rent. The remainder of the project is expected to be completed in phases through to the second-half of 2023.

Aggregate Holdings is a predominantly Germany-focused property company but also has interests in Portugal. The company had €4.8bn of assets and a project portfolio with a €5 billion gross development value at end-2020.

Aggregate also owns Quartier Heidestrasse in Berlin, which is the largest mixed-use development project in Central Berlin at 295,000 sq m. It is due to be completed by 2023, and will be held long-term as a yielding asset. Other Aggregate holdings include VIC Properties, the largest real estate developer in Portugal and a 26.6% stake in Adler Group, a major European residential player.

Corestate CEO René Parmantier said: “The market for real estate private debt offers us considerable opportunities due to the increasing regulatory requirements for banks, which we intend to and will use with the future Corestate Bank as a financing platform for the entire real estate life cycle.”