Expansion of a pure office real estate portfolio with sustainable value
In line with the corporate strategy, the acquisitions focus on office properties in the Core(+) and Value-add categories in attractive Germany metropolitan regions. The portfolio consists of profitable and valuable properties. The assets are held on a long-term basis. They are characterised by high organic growth potential through vacancy reduction. By leveraging this potential, increasing cash flow and attractive returns are achieved. These properties form the backbone of the portfolio. The company differentiates between two segments:
Core(+)-Portfolio. The Core(+) Portfolio is characterised by office properties in attractive locations with potential for appreciation, stable cash flows and a moderate risk profile. Here, the remaining rental periods (WALT) are average and vacancies are not particularly pronounced. The rents of these properties can nevertheless be slightly below average. This results in an attractive potential for value appreciation.
Value-add-Portfolio. This category comprises properties with above-average potential for appreciation. These properties are characterised by relatively high vacancy rates and/or comparatively low rents and short residual rental periods (WALT). These properties are also located in the growth metropolises of Germany. With active asset management, Covivio Office realises the appreciation potential of these portfolios. As a result of the increasing rental income resulting from this, the value of the existing portfolio is continuously increased, thus increasing the value and profitability of the company.