Lars Schnidrig, CEO CORESTATE Capital Group, Germany
CORESTATE Capital Group has big ambitions to expand its footprint in Europe from its base in Germany focusing on offices and residential, newly-appointed CEO Lars Schnidrig told The Real Estate Day.
‘We are concentrating on megatrends, so half of our portfolio is residential and micro living and the other half is core office in core cities and in prospering medium-size cities,’ he said. ‘We want to become the leading real estate investment management house in the Eurozone and the preferred partner for our valued clients’.
At present 75% of Corestate assets are in Germany, where it has 700 employees and €26 bln AUM.
The group discovered micro living ten years ago, so it had time to build up its operations in this asset class and it has become market leader in Germany.
‘Our clients ask for flexibility in how they live and in how they work and we aim to have products ready for each and every generation,’ Schnidrig said. ‘Our plan is to roll out our micro living products throughout Europe’.
The gap between supply and demand in residential is the same in Germany and in the rest of Europe. This is why mezzanine finance has become a key strategy for Corestate, he said, which has become market leader in German-speaking areas.
‘Cities are booming and people need more homes,’ Schnidrig said. ‘The German government has set a target to build 1.5 mln homes between now and 2021, but someone needs to finance them. So we provide the mezzanine finance, the banks provide the senior loans and the developers the equity portion. As with micro living, we are planning to spread this out throughout Europe’.
Sustainability is another focus. ‘We have spent a lot of resources in financial terms but also in time devoted by our colleagues to this topic,’ he said. ‘In due course we will publish our first digital ESG report, which will be totally transparent and will commit us to clear targets which we can be measured against’.
Being sustainable is now a prerequisite to do business with institutional clients, who are still 30% under allocated to real estate. ‘We are investing in our infrastructure in favour of our clients,’ Schnidrigsaid. ‘We want to set a new industry standard for sustainability’.
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