Madison International Acquires Stake in Signa Prime’s $14B Portfolio
With MIELE II Sarl, a Luxemburg fund, Madison International Realty has purchased a 5% equity stake in Signa Prime, a $14 billion (€12.5 billion) European real estate portfolio.
NEW YORK CITY—Madison International Realty with the Luxumburg-based investment vehicle MEILI II Sarl, has acquired a 5% equity stake in Signa Prime Selection AG, an approximately $14 billion (€12.5 billion) European real estate portfolio. The assets include 27 trophy properties and development projects as well as the 60-asset Kaufhof real estate portfolio.
The seller is Signa Holding GmbH. Spanning approximately 25.8 million square feet (2.4 million square meters), the portfolio includes luxury retail, department stores, office, hotel and residential assets.
About 80% of the portfolio is located in Germany, with 18% in Austria and 2% in Italy. The majority of the properties are fully stabilized core assets with positive cash flow, almost 100% occupancy level and an average unexpired lease term of 18 years. Madison International also indicates the portfolio offers attractive upside potential, with many of the rent levels below current market rates, and several highly attractive development and redevelopment projects.
The portfolio includes iconic properties such as KaDeWe Berlin, Oberpollinger and Alte Akademie in Munich, Upper West Tower Berlin, the Alsterhaus Hamburg, the Park Hyatt and Golden Quarter in Vienna, Kaufhaus Tyrol Innsbruck and the Elbtower in Hamburg. Within the Kaufhof real estate portfolio are the Galeria Kaufhof Alexanderplatz Berlin, Zeil Frankfurt and Carsch Haus Dusseldorf.
Matthias Cordier, managing director at Madison International Realty, says the transaction fits extremely well with the company’s strategy, as an investment in a significant and strong European portfolio. “Signa Prime not only comprises a number of extremely high quality properties which offer long term stable cash flows in our core European markets, it also provides great upside potential from rental reversion and a number of opportunities to create value through development and redevelopment,” says Cordier.
“Our investment also allows Signa to continue to diversify its investor base,” adds Derek Jacobson, Madison International’s co-chief investment officer. “We are impressed with the quality of Signa’s management team and continue to believe in Germany as a core Madison target market.”
Neither the buyer nor seller used external brokers.
Founded in 2000, Signa Holding GmBH is Austria’s largest privately-owned real estate company. In March, with RFR Holding, the SIGNA Group acquired the Chrysler Building in New York City from the Abu Dhabi Investment Council and Tishman Speyer, reportedly for about $150 million.