German REIT or similar....

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25th Oct '16 by Carey Blunt

8 comments 12446 reads

Anyone got any thoughts on interesting plays on the German property market?

My theory is.....

Brexit causes banks to leave London and go to Frankfurt,
Frankfurt booms as a result causing upwards pressure on prices for both Office and residential property.

I'm told that residential property is already in serious demand in Frankfurt, with a market very similar to London a few years ago.

Anyone got any exposure to a German REIT or similar that could be interesting? A quick Google suggested Alstria Office REIT AG or maybe Dream Global REIT which is listed in Canada but invests in Germany. Any advantage to that structure?

All thoughts gratefully received!
cheers
Carey

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About the Author

Carey Blunt

Premium Member

Just an IT professional trying to make a decent return on whatever money I can get together.

8 comments

Billy Mitchell

30th Oct '16

I have the Dream one, its super cheap compared to anything else in Germany, I think it is because its a cad listed eur asset stock with not a lot of local interest and also the other dream reits are in a bit of a mess with exposure to the oil patch in Canada which have caused issues for them, the Global reit however is German assets so I think very good value, only fly in the ointment is Cad witholding taxes on the divs which I am too lazy to try and claim back or get out of ....

jjis

30th Oct '16

You could look at Summit Germany (LON:SMTG) which might offer what you are looking for in terms of exposure. Not especially cheap as appears to be on a premium to NAV but does pay some dividends. Seem to remember the MD didn't do so well on a previous German residential REIT with a similar name, but the Non Exec Chairman is harry Hyman who I believe has a pretty good reputation in property circles. You would need to check out the structure as it seems to have quite a bit of debt and subsidiaries etc. One I have traded in, but not currently holding, hope this helps.

Carey Blunt

30th Oct '16

Thanks for the reply Billy. Glad to get the feedback, I'm going to look into it more detail.
Carey

Carey Blunt

30th Oct '16

Thanks jjis, I'll check it out in more detail.

dustyie

30th Oct '16

Frankfurt isn't the only city to benefit from Brexit , I think the staff of these banks will have some input to the relocation of these banks etc. Be it Fankfurt ,Paris , Amstedam , or Dublin , I think a lot of them would favour Dublin . Perhaps we should put ourselves in there shoes (the bankers ) and think switch city would you like to move to .
The biggest problem for financial institutions will be trying to keep key personnel while relocating .
That why I have recently purchase two reits in the Dublin property sector , Hibernia Reit, and Green reit
and looking at Irish Residential Properties reit
Plus all of big American names are in Dublin from Google to Facebook, and are continuing to expand

Carey Blunt

31st Oct '16

It's an excellent point, I hadn't considered Dublin but you are absolutely right. I'll check that out, thanks.

cig

6th Nov '16

Sirius Real Estate (LON:SRE) is a UK listed German commercial property REIT. Not narrowly Frankfurt though. Also a few bankers moving may not have that much impact on the market, if they build a few extra office blocks accordingly.

For generic German residential property exposure, there's a bunch of big German listed players like Deutsche Wohnen, Vonovia, etc.

johnhop

10th Nov '16

Taliesin Property Fund (TPF) and Phoenix Spree Deutschland (PSDL) are two german funds worth investigating. They have properties in Berlin, where property still seems cheap compared with Uk. Thet trade at a premium to NAV, but NAV is rising and the stated NAV is quite conservative imho.

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German REIT or similar....

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Carey Blunt

8 comments

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