Investment Strategy
Our main focus is Germany, with interests also in Portugal, where structural market imbalances exist in the supply and demand of residential and commercial properties.
Addressing such structural market needs with the right development solutions, provides for long-term investment success and strong growth prospects. This is achieved by either directly investing into large-scheme development projects or real estate developers.
As a fully integrated real estate development platform, Aggregate Holdings is covering the entire value chain in its investments: from acquisition and financing to planning, development and marketing with the aim to then either sell to third parties or keep as yielding asset for the long-term.
Strategy – Strong focus on value creation
- Access to unique off-market transactions
- Long-lasting business network established across Germany & other EU countries
- Positioned to acquire further plots and / or real estate developers
- Development profits as key driver of value creation
- Selective assets developed to own
- Profitable utilization of own land reserves
- Specialist in forward-sale to institutional investors and condo selling to individuals
- Reinvestment of profits into acquisition of identified pipeline
- Wide and structured approach to construction financing
- Ability to further optimize existing capital structure
- Broad network of international lending partners
”Build & Hold“ assets
Selective development assets sourced to keep long-term as yielding assets after construction.
Inhouse project management and development combined with optimised financing solutions maximise the basis for strong value accretion of these projects post completion while assets are let out and generate rental cash flows.
Core Projects
”Build & Sell“ assets
Development assets are constructed and sold to institutional investors and individual investors. Development margins are enhanced by optimising project financing in conjunction with effective capital recycling.
The efficient matching of construction milestones with received deposit payments on sales allows for cash flow optimisation and project risk reduction.
Core Projects
Financial real estate assets
OTHER ASSETS INCLUDING LIQUID SECURITIES, NON-CORE PROJECTS AND OTHER INVESTMENTS
This segment includes various investments, which is the combination of strategic long-term and short-term investments. The different strategies can be applied across various investment time frames to either focus on maximising shareholder value or to create liquid investment profiles. Aggregate has historically utilised this segment efficiently to hold stakes in some of the largest real estate companies in Germany and the German-speaking region. The segment currently holds an impressive development portfolio of eleven real estate projects, located in the major cities of Berlin, Hamburg, Frankfurt and Dusseldorf, as short-term investments now for sale. The segment appraised real estate value is approximately EUR 1bn, the assets are all located in key German cities.
This segment also holds a c.6% stake in Adler Group SA ("Adler Group"), one of the largest residential real estate players in Germany. Adler Group has significant footprint in the Top 7 German cities and also provides a strong platform for growth through its build-to-hold landbank.
Adler Group is an integrated residential platform with unique organic growth pipeline, secured at attractive land values with an experienced development team and platform. It has c.20% reversionary potential across the yielding residential portfolio delivering sector leading LFL rental growth of +4.3% and structurally low vacancy of 3.8%. There is significant NTA value uplift potential from the development pipeline. Adler Group has an ESG rating of 10.7, certifying a low ESG risk, ranking the company within the top 5% rated real estate companies under global coverage.
In December 2021, Adler Group, achieved an transformational milestone with the signing of a portfolio disposal of c.15,500 units generating net cash proceeds of EUR 800m, alongside the sale of 7% stake in BCP to LEG, while granting LEG an irrevocable tender commitment for all its remaining BCP shares until 30 September 2022 totalling EUR 850m. Disposals at a premium to its current book value re-iterates the strong fundamental quality of Adler’s portfolio and demand for residential real estate assets across Germany.