Part of LBBW
What Kind of Objects Do we Finance?
In addition to office and commercial buildings, retail and residential properties, we also finance hotels and logistics and senior properties.
The office – a successful asset class in times of change
Office or working from home? The answer is in fact both. Paradoxically, it was precisely the trend towards working from home that contributed to the remarkable renaissance of the office and especially due to the pandemic, it has transformed itself as an important cultural anchor point, a meeting place for teams and a source of creativity. That being said, the requirements for an office and the way it is designed have indeed changed.
In addition to a good location – preferably in the city centre – criteria such as new work concepts, flexibility and, above all, sustainability are in demand today. The office must attract employees and comply with a wide variety of work and hygiene concepts. In addition, the office is becoming more and more important for a company's image when it comes to looking for new talent. In short, quality is more in demand than ever – in every respect.
In this regard, hopes are resting on modern and innovative projects. The trend towards mixed-use areas can also provide a good incentive, as these allow residential work and commercial activities to exist alongside each other.
Residential – creating living space where the future is at home
As residential real estate caters to one of the most important basic needs, it was left virtually unaffected by the crisis. The German housing market continues to be a strong focus for both domestic and foreign investors. Demand remains high and, following a pandemic-related pause in European internal migration and periods of refugee migration, this continues to increase. Home ownership has become even more attractive as a solid retirement provision for individuals.
Rents and prices have risen sharply, especially in the economically attractive areas with high influx rates. Particularly in the large cities which are benefiting from this increasing urbanisation, the aim is to create as much living space as possible on the scarce amount of free land that is still available.
The parliamentary coalition in Germany, made up of the social, liberal and green parties (SPD, FDP, Bündnis 90/Die Grünen), has again established its own Federal Ministry for Housing, Urban Development and Building and has set ambitious targets of 400,000 new apartments. This can only be achieved by working together with the real estate industry, which is making a significant contribution itself here.
Creativity, courage and openness to new ideas are needed if we want to create living space where the future is at home.
Retail revamped – the changes are here to stay
The way we shop has changed, yet many of our needs remain the same. While lockdowns and other restrictive measures during the pandemic gave online retail another intense boost, there are sectors and needs aside from just local supply where brick-and-mortar shops will continue to lead the way in the future.
The idea of shopping as an experience brings to mind seeing, feeling and trying goods in a pleasant atmosphere. This is an important aspect, particularly after the months of restrictions. There is a clear willingness to consume and a longing for a tangible, hands-on and social experience in society today.
Innovative and creative concepts are in demand in addition to a combination of online and brick-and-mortar retail.
Two areas which are also gaining importance are main shopping streets and pedestrian zones in the city centres, which continue to be in high demand, and mixed concepts that creatively combine living, working and social aspects according to the urban concept of the “15-minute city”.
Hotel real estate – more inland tourism
There is now pent-up demand. A good trend for the hotel industry in Germany is the shift towards more short trips and city breaks, preferably in the same country or in nearby destinations.
The pent-up demand for live events and trade fairs in major German cities means that the number of overnight stays in Germany is also starting to rise again.
Modern concepts and quality are in demand, both in Germany’s top 7 locations and in holiday regions.
Logistics – innovative concepts are in demand
Driven by online retail, logistics real estate is one of the most rapidly growing segments. E-commerce and delivery services are booming, which is also having an impact on the choice of location. In addition to the large logistics sites in green spaces with good motorway access, there is increasing demand for inner-city locations to meet the need for “same day delivery”. But just as with other segments, inner-city space is in short supply. This is why we need innovative, space-saving logistics concepts such as multi-story logistics concepts which fulfil their purpose while at the same time remaining flexible and adaptable to urban planning concepts.
Berlin Hyp has many years of expertise in the logistics segment. You can find interesting information on the topic of logistics real estate here:
Logistics studies
Nursing care real estate: increasing demand
None of us is getting any younger. Quite the opposite in fact. It is no surprise, then, that care properties are increasingly attracting the attention of investors. Due to the demographic development, the baby-boomer generation will reach retirement age in the near future, so one can assume a strongly increasing demand for nursing beds. The occupancy rates in care facilities are already rising.
There is therefore a real need for modern care properties that comply with legal requirements. In comparison with other asset classes, comparatively good returns can still be achieved here.
Our consultants will be happy to assist you with any questions you may have about care properties.