Chinese investment conglomerate Fosun has acquired a 34,000 square metre (366,000 square foot) office complex in the German city of Frankfurt for just over Euro 50 million ($53.5 million) from New York’s Fortress Investment Group, according to recent reports in the German press.
The joint acquisition with UK partner Resolution Property gives Fosun and Resolution ownership of the seven-storey Estrella building on Theodor Heuss Allee in Frankfurt’s Bockenheim district.
Fosun’s deal is the latest in a series of purchases of properties in continental Europe by Asian investors over the last year, as buyers from mainland China and other Asian nations increasingly look to the continent for yield.
Fosun Looks Forward to More Deals After Frankfurt Buy
“Estrella is an important step for Fosun Property’s European investment and management platform, which marks the debut with Resolution Property on the European mainland and a significant commitment to the German market,” Fosun Property President Alex Gong, was quoted as saying in a press account. “We will continue to look forward to similar value-adding investments.”
Fosun set up a joint venture with the UK’s Resolution Property in 2015, with the Chinese Group saying at the time that it planned to use the partnership to create a European real estate investment platform.
The deal is Fosun’s first property acquisition in Germany but the mainland group had agreed in 2015 to purchase German private bank Hauck & Aufhaeuser Privatbankiers for as much as 210 million euros. That deal successfully closed in September of last year.
The German deal also follows closely after Fosun was revealed earlier this month as having purchased the historic Voentorg building in Moscow for a price of as much as 10 billion rubles ($168 million). In 2015, the company founded by Shanghai-based billionaire Guo Guangchang and four of his buddies from Fudan University made their first European property purchase with the $381 million purchase of a landmark Milan office building.
More Asian Investors Go for German Opportunities
Fosun and Resolution reportedly plan to renovate the Estrella building and reposition it as a centre for tech and creative industry tenants. In addition to office facilities, the repositioned centre is planned to incorporate cafes, bars and other amenities. Work on the renovation is expected to begin this year with completion planned for 2018.
Fosun’s Frankfurt deal follows just a few month.s after Chinese sovereign wealth fund CIC led a $1.2 billion investment into a Morgan Stanley Real Estate Investing fund that purchased German residential property company BGP. That late October deal followed just a few weeks after Singaporean sovereign fund GIC invested in a German student housing platform that totalled 1,000 beds of accommodation in Frankfurt, Darmstadt, Munster and Dresden, as well as other German cities.