HAMBURG IS GROWING WITH ITS OPPORTUNITIES - INVESTMENT PROPERTIES IN HAMBURG MARKET REPORT 2018 - Zinshausteam ...
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HAMBURG IS GROWING WITH ITS OPPORTUNITIES. INVESTMENT PROPERTIES IN HAMBURG MARKET REPORT 2018 zinshausteam-kenbo.de
INVESTMENT PROPERTIES
INDEX
The market for investment properties in Hamburg 4
Käufer sPurchasers searching in eastern areas 4 EDITORIAL
Price index for existing properties 5
Sales in the city districts 6 Dear Ladies and Gentlemen, rate below the ECB’s declared goal of
New residential districts and locations 7
2 %. The problems encountered within
Oberbillwerder 7
Horner Geest continued record-breaking turnover on the scope of this consolidation course
7
Densification along arterial roads 8 the investment property market; record- have mainly been brought about by vo-
Discount supermarket apartments 9 breaking take-up in the office and com- ters’ protest actions. Italy is, for example,
The housing market in Hamburg 9 mercial property segment; multipliers of the first major EU country to have elec-
Highest rent increases in Wilhelmsburg 10 over 30 for residential and commercial ted a Eurosceptic, right-wing populist
Intervention by Hamburg’s government 10
properties in prime locations – almost government. Viewed in the context of
The Social Preservation Ordinance 11
20-year lock-in period the rule, not the exception in Hamburg. other right-wing populist governments
11
Hamburg’s construction code reformed 11 Figures for Hamburg’s real estate mar- with a nationalistic focus, the current si-
The rent cap 12 ket in 2017 and 2018 reflect the on-going tuation is having a greater negative im-
The future of the rent cap 13 strong demand for property. pact on political unity and thus the EU’s
Passing on of modernisation costs and the rent index 13 economic performance than the prior fi-
Share deals moderately affected 14
Demand is currently high because capital nancial crisis did. In light of the possibili-
Constitutional judges push forward property tax reform 14
Trends and outlook is easily available. When considering their ty of a trade war with China and the EU it
15
Alternatives for investment property investors 16 strategies going forward, both purchasers is unclear whether the USA will take any
Rented freehold apartments 17 and sellers should bear in mind that in further steps to raise interest.
COMMERCIAL INVESTMENT June the European Central Bank (ECB)
Commercial investment in Hamburg 18 decided to phase out the purchasing of International political developments are
The commercial investment market 18 new bonds by the end of 2018. The base of major importance to Germany, an ex-
Borough centres on the up 20 interest rate is, however, set to remain port nation which has the world’s largest
Competing uses 21 at 0 % until at least summer 2019. Ex- trade surplus – US $ 287 billion in 2017.
Office real estate 21
perts agree that in the next two to three One in four German jobs is dependent on
Sales in the city districts 21
Mixed use causes supply shortages years only small increases in interest are export and Hamburg, a significant ma-
22
Price index for commercial investment properties 23 to be expected, if at all. While real estate ritime port, is no exception.
Co-working increasingly popular 24 yields will thus not fall any further, they
Lack of small projects 24 will also not rise significantly. The city began to promote property cons-
The HafenCity as an alternative 25 truction earlier than other major German
Kleiner Grasbrook, Diebsteich and the west 26
The economic situation in many Euro- cities and has had success in this regard.
Change in the retail segment 26
The southern Überseequartier district pean crisis states has improved consi- The number of planning permits issued
27
Tourism booming 27 derably, with the most recent inflation since 2011 has tripled, while the number
Changes of use in the districts 28
References – Investment properties and commercial properties 29
Picture credits: Arne Hoffmann/arnehoffmann.de · Matrix Development ·
MOMENI Gruppe · iStock/istock.com · Andreas Vallbracht/prachtvoll.de
EDITORIAL
Matthias Baron Moritz Gäde Guido Bennemann Mitschi Fraatz David Kenney Nadja Kruse Oliver Sieweck Andreas Boberski Thomas König Lars Linnenbrügger
Managing partner Investment Managing partner Marketing & Managing partner Assistent to the Managing partner Managing partner Managing partner Managing partner
Consultant Public Relations Management
of residential units completed has dou- off. Limitation of the passing on of mo- ruction of the U5 and S4 train lines and subject of lively discussion. 1a locations
bled. Care must now be taken to ensure dernisation costs by owners to their te- the covering of the A7 motorway to pro- are shrinking, while stores are becoming
that the consequences of the boom do not nants to 8 % as well as the collection of duce a tunnel are upgrading existing re- smaller. Owners are being forced to con-
impact negatively on the success story. rent index data from the last six or eight sidential areas and creating new ones. sider changes of use for upper storeys
years – instead of the current four – in and secondary locations. Demand is still
These consequences include rising pri- order to calculate lower average rents Developers on the commercial proper- high, however compromises are neces-
ces for plots and, in the last two years are not appropriate instruments to mo- ties market are faced with a challenging sary with regard to the rents that can be
in particular, higher costs and reduced tivate the construction of rental apart- trend in the city centre, where competiti- achieved. The city centre is facing more
availability of construction companies. ments. Hamburg, furthermore, must on exists for office, residential and hotel competition from the district centres,
Developers and housing enterprises, not also contend with widening of the soci- space. The rise of mixed use is advanta- while also competing for tenants with
to mention private owners, are compe- al preservation statutes to ever increa- geous for urban flair – and is also taking the southern Überseequartier district,
ting to win the services of construction sing areas of the city centre. place in borough and some district cen- due for completion in 2021.
companies and trades, often paying far tres – but exacerbates problems due to
more than originally budgeted. Parallel to this, tenants are displaying competition and high price levels. Com- One thing is certain – Hamburg owners
willingness to consider less frequented petitors in the office segment are incre- have no need to fear that their proper-
In addition to this, state intervention is but well-developed Hamburg boroughs asingly providers of co-working spaces ties will remain vacant in the long term.
hampering construction activity. The – particularly in eastern and southern willing to pay high rents and conclude
reanimation of the Grand Coalition has regions. This presents opportunities for long-running contracts. With kindest regards
resulted in the resuscitation of the rent owners and developers. The extension
cap, which had previously been written of the U4 underground line; new const- The future of High Street retail is the ZINSHAUSTEAM & KENBO
zinshausteam-kenbo.de 3
INVESTMENT PROPERTIES
THE MARKET FOR INVESTMENT PROPERTIES IN HAMBURG
NUMBER OF INVESTMENT PROPERTIES SOLD Hamburg’s investment property market two-figure increases. The biggest jump
slowed down in 2017. While the number was in the ‘preferred locations’ segment,
700 of transactions has been moving laterally where prices rose by 27 % to € 5,538/m²
614
600 for years now, the turnover generated has – a figure, however, generated by only
495 459 421 427 438 439
500 now also stabilised. At 439 the number of 15 transactions. The average price per
386 404 411 367
400 transactions concluded in 2017 was just square metre increased by 6.7 % to €
300 one higher than in 2016, while turnover 2,801 – a higher percentage than in 2016.
200 rose by 4.5 % to € 1.613 billion – once
again an all-time record figure. This in- In 2017 multipliers in less attractive loca-
100
crease, however, was substantially less tions grew by over two annual net rents to
0
than the turnover growth of 27 % recorded 21.2. The highest multipliers were, as is
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
by the Hamburg Committees of Valuation traditionally the case, recorded in the pre-
Experts from 2015 to 2016. Turnover per ferred locations – 32.7. In contrast, multi-
property increased to € 3.67 million in pliers for poor and good locations fell. The
TURNOVER (in million euros) 2017 and was thus 4.3 % higher than in 2017 average achieved for all locations
1.613 2016, again a figure never before achie- was 23.6 times the annual net rent.
1.543
1600 ved. Even in the boom year of 2007 tur-
1400 nover per property was only € 1.8 million. On average, purchasers looking for sui-
1.214
1200
1133 1188 table properties for privatisation into
886 901 873 800 Turnover development is also reflec- freehold apartments paid a multiplier
1000
637 687 ted in the differing directions in which of 24.9, while the square metre price for
800
purchase prices and purchase price such properties was € 3,372, just over
600
multipliers have developed in various € 100 more than in 2016.
400 locations. While the demand dynamic
200 in 2016 led to rises in prices per square PURCHASERS SEARCHING
0 meter and multipliers in all locations, IN EASTERN AREAS
in 2017 the picture was far more mixed. Although the number of transactions in
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
‘Poor’ and ‘good’ locations experienced 2017 changed very little in comparison
slight price adjustments (-6.1 % respec- to 2016, their distribution across the city
Source: Property Market Report 2018, Gutachterausschuss tively -1.6 %) while other locations saw was markedly different. For the first time
4
INVESTMENT Zinshäuser
PROPERTIES
PRICE INDEX FOR EXISTING PROPERTIES
CATEGORY DISTRICTS DISTRICTS WITH POTENCIAL MULTIPLIER PRICE PER m2/€ TREND
Blankenese, Flottbek, HafenCity, Harvestehude, Ho-
PRIME 29 - 35 times
LOCATION
henfelde (West), Nienstedten, Othmarschen,
Rotherbaum, Uhlenhorst (West), Winterhude (Süd)
–
annual rent
4.500 - 5.500 Ò
Barmbek-Süd, Eimsbüttel (Nord), Eppendorf,
GOOD 27 - 32 times
LOCATION
Hoheluft-Ost, Marienthal, Ottensen, Schanzenviertel,
St. Georg, Uhlenhorst, Wellingsbüttel, Winterhude
–
annual rent
3.500 - 4.500 Ò
TRENDY Altona, Hamm, Hammerbrook, 24 - 28 times
LOCATION Karolinenviertel, St. Pauli
Bahrenfeld, Barmbek-Nord
annual rent
2.600 - 3.600 Ò
Bergedorf, Fuhlsbüttel, Harburg, Bramfeld, Dulsberg, Eilbek, Horn,
SECONDARY 22 - 25 times
LOCATION
Heimfeld, Iserbrook, Jenfeld,
Poppenbüttel, Rahlstedt, Sasel
Langenhorn, Lokstedt, Lurup,
Schnelsen, Wandsbek
Annual rent
2.400 - 3.000 Ò
TERTIARY Billbrook, Billstedt, Neugraben- 17 - 19 times
LOCATION
Rothenburgsort, Veddel
Fischbek, Tonndorf, Wilhelmsburg annual rent
1.800 - 2.300 Ö
POOR 15 - 18 times
LOCATION
Moorfleet, Neuenfelde Süderelbe, Oberbillwerder
annual rent
1.500 - 1.900 Ö
5
5
INVESTMENT PROPERTIES
Wohldorf-
Ohlstedt
Duvenstedt
in ten years no borough had more than SALES IN THE CITY DISTRICTS IN 2017 None
Lemsahl-
15 transactions, however an above ave- Mellingstedt
1
rage number of boroughs had 10 or more Bergstedt 2
transactions. Poppen-
büttel 3 to 4
Langenhorn
Sasel 5 to 6
Hummels- Volksdorf
büttel
The Top 5 districts are the perfect illus- Wellings-
büttel
7 to 9
Schnelsen
tration of the interest across the entire Niendorf
Fuhlsbüttel 10 to 19
Ohlsdorf
spectrum of locations. The Committees 20 and more
Groß Steils- Rahlstedt
of Valuation Experts for Billstedt, Eims- Eidelstedt Borstel
Alster-
dorf hoop
Farmsen-
Bramfeld Berne
büttel and Winterhude recorded 15 tran- Lokstedt
Lurup Eppendorf Barmbek-
sactions each while 14 sales each were Rissen
Stellingen
Hohe-
Winterhude Nord
Duls- Wands-
Tonndorf
luft berg
made in Altona-Altstadt and Harburg. Sülldorf Iser-
brook Eims-
Harveste-
hude
Barmbek-
Süd
bek
Osdorf Bahrenfeld büttel Jenfeld
Uhlenhorst
Sternschanze Eilbek Marienthal
Rotherbaum
Blankenese Groß Altona Hohen-
Flottbek St. felde
The figure for Billstedt is indicative of -Nord
Neu- Georg Borg-
Nienstedten Otten- St. stadt Alt- felde Hamm Horn
the significant growth of interest in Othmarschen sen Altona Pauli
-Altstadt
stadt Hammer-
brook Billstedt
Hamburg’s eastern boroughs of Wands- Cranz
Finkenwerder HafenCity
Rothen-
Waltershof Steinwerder burgsort
Kleiner Billbrook
bek and Bergedorf, with the sales in the Grasbrook
Veddel
districts of Eilbek, Hamm and Marienthal,
Neuenfelde Altenwerder
Lohbrügge
all closer to the city centre, above ave- Francop
Moorfleet
Billwerder
rage. Bramfeld has also become more Wilhelmsburg
Taten-
Moorburg berg Neuallermöhe
attractive to investors in the last two ye- Spaden-
land
Bergedorf
Neugraben- Allermöhe
ars, as have the peripheral districts of Fischbek
Hausbruch
Reitbrook
Billstedt and Lohbrügge. The trend for Heimfeld
Harburg
Neuland Ochsenwerder
Curslack
investment in locations which are classi- Neuengamme
Eißendorf
fied as poor and are thus less expensive Wilstorf Gut Moor Altengamme
Marmstorf
is a further reason for the restrained rise Rönneburg
Kirchwerder
Sinstorf Langenbek
in capital turnover.
Source: Property Market Report 2018, Gutachterausschuss
6
Keine
1
INVESTMENT PROPERTIES
MULTIPLIERS 2008–2017 Prices per square meter in € 2008–2017
Good location Tertiary location All locations Prime location Tertiary location All locations
27,1 26,7
5.538
23,9
23,6
22,9
4.495 4.375
21,5
3.894 3.856 4.012
20,7 20,5 20,3
19,4 3.428
18,7 21,2 3.101
17,8 18,1 18,1 2.801
2.624
16,8 19,0 2.485
2.229 2.256
15,4 16,0 17,9 1.865 2.101
17,5 1.927
1.700
16,3 16,8 1.599
16,0 1.319 1.368 2.132
14,3 15,4 1.713 1.745 1.861
14,9 1.481 1.507
14,3
1.231 1.375
1.140 1.058
13,0 12,5
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source: Property Market Report 2018, Gutachterausschuss
NEW RESIDENTIAL DISTRICTS ral Parliament thus approved € 50 million OBERBILLWERDER with Karres + Brands and Transsolar
AND LOCATIONS for the rejuvenation of social and sports Oberbillwerder is the site of Hamburg’s Energietechnik, a Danish-Dutch-German
Investment property purchasers are infrastructures within the scope of this largest project within the scope of this team which won an urban development
not the only ones to have discovered model programme. Hamburg is co-finan- greenfield strategy. Plans envisage the workshop process in June 2018, is cur-
Hamburg’s eastern areas, which have cing these measures and will contribute creation of a district with 7 000 residen- rently being developed and should be
been neglected in past decades. Project a further € 50 million by 2025. tial units and 5 000 jobs on 124 ha of completed by the end of 2018.
developers are also looking for affordable marshland over the next 15 years. The
plots with links to S- or U-Bahn trains in In response to strong population growth, gross floor area will be just under 1 mil- HORNER GEEST
order to build reasonably priced housing. with an annual inflow of up to 20 000 new lion m². Chief Planning Officer Franz- Oberbillwerder is already linked to
In addition to this, the city’s “Stromauf- residents – many of whom are on low Josef Höing hopes to see a “quantum Hamburg’s public transport network
wärts an Elbe and Bille” urban develop- incomes – in 2015 the city expanded its leap” with regard to energy, mobility and via the existing Allermöhe S-Bahn train
ment concept is drawing more attention “More City in the City” philosophy of buil- social, cultural and mixed use. A master station on the S4 line. The new urban dis-
to eastern areas. At the end of June the ding on vacant urban plots to include the plan based on the urban planning design trict of Horner Geest will benefit from the
Budget Committee of the German Fede- “More City in New Locations” concept. proposed by the Adept Aps consortium opening of a station on the extended U4
zinshausteam-kenbo.de 7
INVESTMENT PROPERTIES
underground line, expected to be ready through increased e-mobility, use of pu-
by the mid-2020’s. In early July 2018 the blic transport and cycling, are, however,
Senate approved commencement of the the primary drivers of better quality of life
“Zukunftsbild 2030” project to create the and housing development in these areas.
Horner Geest urban district. It envisages
the construction of 3 100 residential units Within the scope of a national model
on vacant urban plots between Horner project to increase housing density the
Rennbahn and Öjendorfer Park and new borough of Altona has identified potenti-
construction projects such as the Öjen- al to build 20 000 residential units along
dorfer Gartenstadt development. its main transport arteries Sülldorfer
Landstraße and Osdorfer Landstraße. Re-
There are also plans to construct more search carried out by the city’s CDU, SPD
housing among the low-density buildings and Green parliamentary groups indicates
erected in the Horner Geest area in the that some 100 000 units could be built in
1950’s and 1960’s – and also elsewhere. Hamburg as a whole. The Department of
Chief Planning Officer Höing wishes to Urban Development and Housing (BSW)
make the 60-year old post-war district is currently working with the boroughs to
more attractive while also creating additi- review urban development potential along
onal homes by increasing building density. arterial roads. In addition to large-area
discount supermarkets with flat roofs and
DENSIFICATION petrol stations the focus is on detached
ALONG ARTERIAL ROADS and town house plots near the city centre
Arterial roads – the four- to six-lane and in low-density post-war residential
main roads leading out of the city cen- areas. Wider-ranging building rights are
tre – are a key element of this concept. planned to motivate owners to build more
District centres are often located at the homes on their plots, while municipal in-
intersections of these roads with resi- struments, such as urban planning de-
dential areas built after the war and most velopment measures or planned interior
requiring upgrading. Changing mobili- development measures, are also being
ty strategies, such as lower emissions considered.
8
INVESTMENT PROPERTIES
DISCOUNT SUPERMARKET high. The “Housing Alliance”, formed in COMPLETED HOMES 2008–2017
APARTMENTS 2011 to relieve pressure on the housing
Total completed buildings By companies By private households
Discount food retailers such as Aldi and market, under pressure for more than a
Lidl are taking a proactive stance with decade now, and renewed in 2016, has 9.000 8.521
regard to such measures. In order to expanded its objective of gaining planning 7.722 7.920
8.000
secure existing sites and obtain appro- permits for 6 000 residential units annu- 6.974
val for new ones – particularly near the ally to 10 000 units. In addition to this, the 7.000 6.407
5.874 5.749 5.484
city centre or borough district centres – boroughs have also become members of 6.000
5.080
they are submitting plans which include the Alliance. 5.000 4.294
multi-storey residential buildings above 3.758 3.587 3.520 3.729 3.793
4.000
supermarkets to the planning authorities. Planning permission was, in fact, gran- 2.715 2.489 2.422 2.430
3.000 2.242
ted for over 13 400 residential units in 1.889
1.629 1.678 1.629 1.552
Aldi, for example, has already realized 2017 – a record figure not seen since the 2.000 1.213 1.193
992 1.131
912
such developments at Holstenstraße and 1970’s. In contrast, the number of units 1.000
Bahrenfelder Straße in Altona. Frank completed has, at best, experienced only 0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Conrad, head of Altona’s Urban Planning lateral movement since 2015, with 7 920
Department, has identified potential for units completed in 2017. This figure was
Source: Property Market Report 2018, Gutachterausschuss
some 800 apartments at 16 discount su- only slightly higher than in 2016.
permarket sites in his borough, while the
Borough of Eimsbüttel is already pursu- The strongest upward curve has been little evidence that there has been a rise in 2018. In the first half of the year permits
ing a „discount supermarket strategy” to experienced by the construction backlog speculative purchasing of plots ready for for 4,295 residential units were issued –
create housing. – i.e. residential units which have been development. The increasing construction 39 % less than in 2017. Should the slump
approved, however not yet completed. At backlog is often caused by capacity bot- in granting of planning permissions con-
THE HOUSING MARKET IN HAMBURG the end of 2011 this figure was 8 000, at tlenecks on the part of construction com- tinue, then this would confirm the fin-
Dorothee Stapelfeldt, Hamburg’s Senator the end of 2017 just under 25 000 units. In panies in combination with related cost dings of bulwiengesa’s project developer
for Urban Development, is forecasting a Berlin speculation with approved projects increases for personnel and materials. study, carried out in spring 2018, which
relatively conservative figure of 100 000 plays a significant role in the widening concluded that the current planned vo-
additional residents by 2030. Projections gap between approvals and completions. It does not appear that there will be a lume for commercial development pro-
based on current inflow statistics indicate In Hamburg, however, the boroughs and new record-breaking figure for the num- jects in Hamburg was 25 % lower than
that the actual number could be twice as institutes such as empirica have found ber of planning permissions granted in the figure for 2016.
zinshausteam-kenbo.de 9
INVESTMENT PROPERTIES
HIGHEST RENT INCREASES The development of rents is, howe- RENTS QUOTED AND RENT INDEX IN €/m2
IN WILHELMSBURG ver, less dramatic when considered in 2007–2017
Viewed from a statistical perspective, terms of the Hamburg rent index. At €
the number of newly constructed apart- 8.44/m² the average figure for the April Rent quoted for new buildings Rent quoted for existing buildings Rent index average
ments is already insufficient to house 2017 rent index is 29 % above that of
13,89
the population moving into Hamburg. 2007. This figure is influenced by the
12,98 12,92 13,01 13,04 13,00 13,28
New building projects have thus yet to new or re-renting of some 250 000 af- 12,41
have any significant impact on the deve- fordable Saga and housing association
11,00
lopment of rents for existing properties. apartments which are not advertised 10,52
11,02
10,00 10,08 10,20 10,23
According to figures published by em- on portals or in newspapers. Never- 9,61
9,23 9,70
9,03
pirica – gathered from Internet portals theless, the rents quoted by commer- 8,72 8,44
8,24
and daily newspapers – rents quoted for cial housing companies are indicative 7,86 7,56 7,54
8,02 8,02
7,15 7,15
new housing soared by 54 % between of market trends – also for individual 6,76 6,76
6,58 6,53
2007 and 2017, to € 13.89/m². The ove- sub-markets. In the case of empirica
rall increase in rents quoted was more these sub-markets usually comprise
moderate, rising by 40 % to € 11.02/m². two or more districts.
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
As clearly shown by the illustration, incre- By far the largest increase in rents in Source: empirica/IDN ImmoDaten/BSW
ases in rents slowed between 2012 and the period from 2007 to 2017, a plus of
2015, after which the dynamic began to 62 % to € 9.76/m², was recorded in Wil-
accelerate again. Causes of this include helmsburg (together with Veddel and
insufficient, ever more expensive plots; Rothenburgsort). The surge south of weakest rental development, € 14.94/m² INTERVENTION BY HAMBURG’S
rising construction costs due to stricter the Elbe was started by the IBA inter- or + 11 %, was recorded in the second GOVERNMENT
energy requirements and contractors’ li- national architecture exhibition, which most expensive sub-market, the city Hamburg reacted to the emerging
mited capacities; improved incomes due ran from 2007 to 2013. Rents on the centre including the HafenCity district. housing shortage earlier than other ma-
to relatively high collective bargaining ag- up-and-coming St. Pauli/Sternschanze Only the area west of the Alster is more jor German cities, founding the “Housing
reements and also the influx of refugees. market also rose at an above-average expensive at € 15.31/m², however it also Alliance” in 2011. In comparison to 2010
When compared to other major German rate (+ 48 % to € 13.75/m²) as did those experienced below-average rental incre- the number of planning permits issued
cities, only Munich (49 %) and Berlin (73 in Borgfelde/Hamm/Horn (+ 45 % to € ases of 28 %, as did the suburbs along has tripled, while the number of resi-
%) have steeper rent price curves. 10/m²) to the east of the city centre. The the Elbe (+ 24 % to € 13.45/m²). dential units completed has doubled.
10INVESTMENT PROPERTIES
SOCIAL PRESERVATION The city’s red-green Senate does, how- In May 2018 the Department for Ur- that 12 000 new homes subject to rent
ORDINANCE ever, occasionally also impede housing ban Development and Housing (BSW) caps have been completed since 2011.
IN HAMBURG construction or investment in existing announced that social preservation le-
stock. gislation is also being considered for Within the scope of the Housing Alliance,
ALREADY EXISTING large areas of Altona-Nord, home to 22 in 2016 the city undertook to finance 3
Eimsbüttel-Nord, Hoheluft-West, THE SOCIAL PRESERVATION 100 people and bordering on the new 000 publicly-funded new homes eve-
Stellingen-Süd (2018) ORDINANCE Diebsteich, Mitte-Altona and Holsten- ry year. Senator Dorothee Stapelfeldt
Nördliche Neustadt/Venusberg (2018) The Social Preservation Ordinance is a quartier residential districts. Parts of emphasized in July that financing was
Bahrenfeld-Süd (2016) statute specific to Hamburg. In the are- Eilbek are also under review. In addition secure for significantly more than 3 000
Ottensen (2016) as falling under the statute applications to this, following an agreement reached homes. The initial rent for new apart-
Altona-Altstadt (2014) for modernisation; demolition; change of by the Housing Alliance a preliminary ments funded under the scheme to crea-
Eimsbüttel-Süd (2014) use of rental apartments or privatisation review is underway for the Bahrenfeld- te housing for people on low incomes
Ottensen Osterkirchenviertel (2013) into freehold apartments are reviewed West, Ottensen-Nordwest, Hamm, Horn, has been set at € 6.50/m² for 2018; for
Sternschanze (2013) with the aim of establishing what im- Barmbek-Nord, Uhlenhorst, Winterhude apartments funded under the scheme
St. Georg (2012) pact such measures would have on the and Hohenfelde districts. to create housing for people on medium
St. Pauli (2012) area’s social structure. In 2018 social incomes at € 8.60/m². The higher income
Südliche Neustadt (1995) preservation statutes came into force for 20-YEAR LOCK-IN PERIOD threshold, also decided in July, means
the northern Neustadt and Eimsbüttel/ From 1 January 2019 onwards planning that the group of Hamburg households
IN PREPARATION Hoheluft-West/Stellingen-Süd, urban applications for social housing submit- qualifying for such funding has risen from
Bahrenfeld-West districts with a total of 70 000 residents. ted to the approval authorities will be 61 000 to 368 000.
Barmbek-Nord The area in Eimsbüttel, which encom- subject to a lock-in period extended
Hamm passes 64 000 residents, is the largest from 15 to 20 years. The obligatory HAMBURG’S CONSTRUCTION CODE
Hohenfelde ever to come under such legislation. A period for the Saga municipal housing REFORMED
Horn quarter of all households in the borough association will be 30 years. The ex- The modernised Hamburg Construction
Ottensen Nord-West of Eimsbüttel are now subject to the So- tension is intended to stabilise stocks Code (HBauO) came into force on 1 May
Uhlenhorst cial Preservation Ordinance; in the entire of publicly-funded housing in the long 2018. The most important reforms inclu-
Winterhude city of Hamburg the statute affects 187 term following a decline in the number de permission to use load-bearing, stif-
550 residents living in residential districts of social housing apartments from 118 fening or space-enclosing solid wooden
which are primarily located near to the 000 in 2007 to 79 000 in 2017. This nega- construction components for building
city centre. tive trend has occurred despite the fact projects up to 22 m in height (floor level
zinshausteam-kenbo.de 11INVESTMENT PROPERTIES
of the top floor) insofar as compliance concentrate barrier-free apartments on
with the required fire resistance class one floor but instead can distribute them
can be demonstrated. This generally ap- across several storeys, allowing them
plies to pre-fabricated modules made to respond to needs and cost aspects in
from cross-laminated plywood which an optimum manner.
can be erected quickly on site. Wood
has the additional advantage over con- THE RENT CAP
crete, stone or steel of being lighter in The rent cap has been the subject of very
weight, which can be a crucial factor in controversial discussions between the
providing the structural proofs required, housing sector and Hamburg’s politi-
for example, when adding an additional cians for over three years now. In June
storey to a building. A further reform is 2018 Hamburg Regional Court ruled that
that developers wishing to add an addi- the Hamburg rent cap was invalid on
tional storey to a building are no longer formal grounds – for the period from 1
obliged to install a lift (cost per building: July 2015 to 1 September 2017. The ru-
€ 70 000 to € 100 000). This obligation ling is founded on the fact that the “Rent
previously applied to all buildings over Cap Ordinance” was issued on 1 July
13 m in height. When building additional 2015, however its substantiation was not
storeys it is also generally necessary to published until 1 September 2017. The
insulate the façade. Under the new Con- reading of the substantiation is asserted
struction Code developers will no longer to be a “precondition for validity”. Fol-
have to obtain the consent of neighbours lowing the ruling a petition submitted by
for this, even if such work will result in a tenant for reimbursement of overpaid
the minimum clearance between the two rent was rejected. The tenant rented an
buildings no longer being met or building apartment in Ottensen for € 14.01/m² on
components projecting up to 20 cm onto 1 September 2015 although the typical
the neighbour´s land. rent for the area, as based on the 2015
rent index was € 8.75/m² or € 9.63/m²
With regard to disabled accessibility taking into consideration the surcharge
developers are no longer obliged to of 10 % on the typical rent as permitted
12INVESTMENT PROPERTIES
under the terms of the rent cap. (CSU) indicates that the rent cap will be-
come stricter. Tenants will, in future, be
In the meantime, on 3 July 2018 the Se- able to report a breach of the rent cap
nate, which has announced that it does by means of a simple complaint. Should
not share the court’s legal interpretation, the landlord cite a higher previous rent
revised and re-published the rent cap – as grounds for raising a rent, however
including the substantiation. Since, how- fail to provide the tenant with proof of
ever, the Regional Court suspended the this before concluding a contract, then
ordinance for the period for 1 July 2015 to the new tenant can reduce the rent to the
2 September 2017 and the new ordinance level foreseen by the rent cap.
does not apply retrospectively, there is le-
gal uncertainty regarding ongoing cases
dating from these 26 months. The new PASSING ON OF MODERNISATION
Rent Cap Ordinance will be valid until 30 COSTS AND THE RENT INDEX
June 2020. Its scope of validity, namely Legislation regarding the passing on of
for the whole city of Hamburg, is founded, modernisation costs will also be tighte-
for example, on the fact that the vacancy ned up. Whereas landlords could, to date,
rate has been under 0.7 % since 2010 pass on 11 % of modernisation costs to
as well as on the high rent increases in their tenants each year, it is planned
areas which are not popular residential that this figure will, in future, be limi-
districts, such as Barmbek or Hamm. ted to 8 % in areas in which the housing
market is under pressure. In addition to
THE FUTURE OF THE RENT CAP this, an absolute cap threshold will be
While it is true that the regional states introduced. Following this, rents may not
are responsible for implementing the rent be increased by more than € 3/m² for a
cap, it is also a fact that the framework period of six years after modernisation.
conditions are set by the Grand Coalition It is foreseeable that future rent index
in Berlin. An agreement between Minis- calculations will include contracts dating
ter of Justice Katarina Barley (SPD) and back more than the four years currently
Minister of Construction Horst Seehofer taken into consideration. The objective
zinshausteam-kenbo.de 13INVESTMENT PROPERTIES
behind this is to lessen the effect which Federal Ministry of Finance is currently
high rents based on new contracts have developing proposals for supplementary
on figures for typical rents. legislative texts. It is still unclear when
the reform will come into force.
SHARE DEALS
MODERATELY AFFECTED CONSTITUTIONAL JUDGES PUSH
At the end of June the regional Ministers FORWARD PROPERTY TAX REFORM
of Finance decided to reform the Land Since the German states were unable to
Transfer Tax Act, thus raising the hurd- agree a property tax reform two years
le for share deals. Under current legal ago, the Federal Constitutional Court has
regulations, a purchaser can avoid pay- pushed forward the decision with its ru-
ing land transfer tax if he acquires only ling of 10 April. The unit values which
94.9% or less of a property which has have previously been used date from 1935
been converted into a property compa- (for the territory of the former GDR) and
ny. After five years he can purchase the 1964 (for the former FRG) and have di-
remaining 5.1 % from the seller or a co- verged so far from current market values
investor and must only pay land transfer that it will, in future, be forbidden to use
tax on this 5.1 %. them – although municipalities have the
right to influence land tax revenue by em-
The Ministers of Finance have decided to ploying assessment rates. At present € 14
implement three amendments. Firstly, billion flows into municipal coffers each
to avoid paying land transfer tax an exis- year. Property tax reforms must be set
ting shareholder/seller must continue out by the end of 2019 and implemented
to hold shares in the property company. by the end of 2024.
Secondly, the maximum holding which
can be acquired through a share deal has Three models are under discussion – the
been reduced to 89.9 %. In other words, cost value model; the area model and the
in future the existing shareholder must land tax model. The cost value model has
continue to hold a 10.1 % share for, the advantage that 14 of Germany’s 16
thirdly, a period of at least ten years. The states agreed to it 2016, although it is the
14INVESTMENT PROPERTIES
most complicated method to value the 35 as agreed in the German government’s
million properties around the country. coalition contract and intended to mobi-
The model combines land values with lise building land by taxing derelict plots.
retrospectively calculated construction
costs for any buildings. Modernisations, TRENDS AND OUTLOOK
etc. are taken into consideration on a cy- The investment property market is at
clical basis. Hamburg and Bavaria op- its peak. In good and prime locations no
posed this model because it is expected properties are being sold for less than
to result in significantly higher taxes for the equivalent of 30 times the annual net
expensive locations. rent. Such multipliers form the basis for
classification of districts’ location status.
Hamburg and Bavaria’s declared pre- A district can become a good location if
ference is for the area model. It taxes numerous new construction projects are
plot and building sizes at a uniform size- sold at high price levels. The Schanzen-
based rate. Most of the data required for viertel district is thus now a good location
this is already available. The solely land instead of an up-and-coming one. Bah-
tax-based model is even simpler and renfeld, with its many new construction
offers the additional benefit of presen- projects, is also on the way to becoming
ting the greatest steering opportunities. a good location. Northern Barmbek
Under the model, property tax would be and Dulsberg are experiencing strong
based solely on plot value, regardless of growth, as is Langenhorn. The latter is,
whether buildings have been erected on however, too peripheral to become an
it or not. This figure is generally already up-and-coming area. Hamm and Horn,
available within the scope of official land in contrast, have all the characteristics
values. Using this model would make it required to become up-and-coming mar-
possible to increase pressure on owners kets, while Hammerbrook is already an
of unused derelict land and empty plots up-and-coming district which should
to erect buildings instead of, for example, experience good further development.
speculating on increases in value. This Bergedorf will not become an up-and-
model also includes a Property Tax C, coming district but instead will remain
zinshausteam-kenbo.de 15INVESTMENT PROPERTIES
TURNOVER FOR OFFICE & COMMERCIAL PROPERTIES, INVESTMENT PRICE DEVELOPMENT FOR FREEHOLD APARTMENTS in €
PROPERTIES AND FREEHOLD APARTMENTS in € M 2006–2017 2006–2017
Office & commercial properties1 Investment properties1 Freehold apartments1 Total purchase price Price per square metre
1
in Mio. €
402.000
4.000
366.000
3.449 345.000
3.500
318.000
2.941 3.013 2.834 296.000
3.000
2.612 2.612 2.564 278.000
264.000
2.357 2.420
2.500 234.000
2.014 1.937
1.817 1.869 1.813 1.953 213.000 189.000 195.000 200.000
2.000 1.741
1.610
1.281 1.340
1.500
1.142 1.110 1.720 1.721 1.613
1.543
1.000 1.173
1.114 1.188 1.214
1.133
2.233
2.158
2.212
2.320
2.551
2.889
3.060
3.328
3.573
3.828
4.185
4.628
886 901 873 800
500
637 687
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2017
Source: Property Market Report 2018, Gutachterausschuss
a less expensive location. The same also Prices developed laterally in the first half further steps to increase interest rates. In of Germany’s property boom. Construc-
applies to the districts of Rothenburgsort of 2018. Valuation orders have been ac- Europe the European Central Bank (ECB) tion companies and trades thus have
and Veddel, both located near the city cumulating since summer 2017, while gave a clear signal with its announce- full order books for the next five years,
centre. Thanks to the residential districts the order situation has improved thanks ment in June that purchasing of bonds in turn leading to higher prices and re-
planned along the current axis of the to owners wishing to take advantage of would be phased out by the end of 2018. duced availability.
Wilhelmsburger Reichsstrasse, whose market conditions. The base interest rate is, however, set
relocation to the east is scheduled to be to remain at 0 % until at least summer ALTERNATIVES FOR INVESTMENT
completed in 2019/2020, Wilhelmsburg The market has been characterised by 2019. PROPERTY INVESTORS
has exciting potential for upgrading, alt- slow interest rate growth since 2016. It Land prices are a further cost driver
hough its proximity to commercial areas is unclear whether the Federal Reserve The investment property market has which can currently only be re-financed
can sometimes present problems. (FED), the US central bank, will take any also been affected by the consequences by building freehold apartments. Social
16INVESTMENT PROPERTIES
housing, constructed in line with a 30 to apply for conversion approval in good average, in 2017 this figure had fallen to
% quota in Hamburg, is therefore beco- time. They should also obtain certifica- 39 years old. Average apartments sizes
ming increasingly interesting for inves- tion that units are sufficiently separate; are also becoming smaller – caused by
tors since fewer privately financed new have the declaration of aportionment of- the decreasing size of new apartments,
investment properties are being built. ficially certified in line with the German in turn the result of partial compensation
Apartment Owners Act and create land for high price rises and the wish to crea-
A number of larger portfolio transactions register entries for each apartment. te more units per project. Square metre
at the end of 2017 have confirmed the prices have thus climbed by 10.6 % to €
existence of the phenomenon that lar- RENTED FREEHOLD APARTMENTS 4 628; this is higher than the increase in
ger portfolios achieve higher prices per Rented freehold apartments are an overall purchase prices.
property than would be the case if the attractive alternative for private pro-
investment properties were sold individu- perty investors. Thanks to the virtually A study of popular locations and corres-
ally or in smaller portfolios, as described non-existent vacancy rate in Hamburg, ponding prices provides information on
in the 2017 market report. This bonus, banks are prepared to provide 100 % fi- the spectrum of purchasers and interest
resulting from the pressure on capital nancing. Figures issued by the Hamburg in districts which have good infrastruc-
experienced by large investors, means Committee of Valuation Experts show tures but are not necessarily close to
that prices are even higher for private that 6 363 freehold apartments were the city centre. The highest number of
and medium-sized investment property sold in Hamburg in 2017 – 9.4 % less sales, 387 apartments, was recorded in
investors, depriving them of investment than in 2016. Capital turnover, however, Winterhude (€ 5 148/m² average), ahead
opportunities. increased by 5.5 % to € 2.55 billion – of what is by today’s standards mode-
another all-time high on Hamburg’s real rately priced Eimsbüttel (343 sales/€ 5
Developers wishing to privatise proper- estate market. The price per apartment 042/m²). There were also more than 200
ties into smaller units are also experi- has risen by 9.8 % to € 402 000 – higher sales in Barmbek-Süd (270/€ 4 039/m²),
encing shortages due to the widening of than the increase of 6.1 % from 2015 inexpensive Rahlstedt (228/€ 2 666/m²),
social preservation statutes in districts to 2016. Eppendorf (206/€ 5 596/m²) and Langen-
close to the city centre. Investment pro- horn (203/€ 3 881/m²).
perty owners who wish to have the op- The larger number of newly constructed
tion of making flexible decisions which properties means that the average age In general it can be said that residential
are not dependent on social preservati- of an apartment is declining. Whereas in properties in Hamburg are, and will re-
on statutes when selling should be sure 2008 apartments were 48 years old on main, secure capital investments.
zinshausteam-kenbo.de 17COMMERCIAL INVESTMENT IN HAMBURG Hamburg is growing. The city’s red-
green Senate expects 100 000 additional
residents by 2030. International quality
of life rankings place Hamburg near the
top – British magazine ‘The Economist’
for example currently ranks the “Gate-
way to the world” 18th in the world.
The city offers investors qualities which
were once considered unexciting – sta-
ble, reliable key economic data and a
diversified economic profile with the
port as a motor. The unemployment
rate is 6 % while the number of people
in work has increased by 100 000 over
the past five years. With an overall eco-
nomic productivity (per capita GDP) of
€ 60 000 Hamburg is one of Europe’s
leading cities.
The PWC and ULI real estate study
“Emerging Trends in Real Estate Eu-
rope”, published in early 2018, ranked
Hamburg the 6th most important Eu-
ropean major city out of a total of 30.
THE COMMERCIAL INVESTMENT
MARKET
Figures published by the Hamburg Com-
mittees of Valuation Experts on trade
18Commercial Investment
NUMBER OF OFFICE AND COMMERCIAL PROPERTIES SOLD TAKE-UP (in 1.000 m2)
1200
400 1.081
341
350 1000
300 272 294 284 911 906 867 855
300 786
241 235 247 225 229 800
250 649 643 624
160 583
200 600
150 380
400
100
200
50
0 0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2017
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
in office and commercial real estate il- half of the year the Springer residen-
lustrate the high level of interest in the tial district in Neustadt, for example,
TURNOVER (in MIO. €)
city’s commercial properties. During the purchased as a forward deal by the Doc-
real estate boom of 2006 and 2007, 334 tors’ Pension Funds of Lower Saxony, 3449
3500
respectively 341 transactions were con- Saxony-Anhalt and Mecklenburg-Wes- 3013 2834
3000
cluded – significantly more than the 229 tern Pomerania; the Veterinary Surge- 2612 2612
2500
contracts in 2017. Although the number ons’ Pension Fund of Lower Saxony and 1817 1869
2014 1937 1813
2000
of transactions in 2017 was a third lower the Tax Advisors’ Pension Fund of Lower
1500 1281
than in 2006, turnover, however, was € Saxony, was one of the largest single
3.45 billion, the highest figure to date property transactions ever to be con- 1000
and 17 % above the volume for 2006. At cluded in Hamburg’s investment history. 500
over € 15 million the average transaction 0
volume was also a new record. The vendor, the MOMENI and Black Hor-
2017
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
se joint venture, achieved a sale price
An extremely high turnover volume is of approximately € 400 million. The
once again expected for 2018. In the first purchase of the Olympus Campus in the Source: Property Market Report 2018, Gutachterausschuss
zinshausteam-kenbo.de 19Commercial Investment
City Süd district by the Doctors’ Pension ahead, for example, of retail properties
Fund of Westphalia-Lippe together with in terms of turnover for the first half of
Hines from project developers Campus 2018. Secondly, investors are focusing
Properties 1, held by the Zech Group and more strongly on district centres such
Olympus, for € 260 million is indicative as Langenhorner Markt. These centres
of a trend on the investment market – are the locations in which retail, other-
large pension funds are acquiring large wise experiencing a decline in district
development projects. side streets and along arterial roads,
is concentrated. This applies both to
Of the five transactions worth over € 100 online-resistant local retailers such as
million only one was an existing proper- food sellers and drugstores as well as
ty, the Sumatrakontor office building in also small, owner-operated boutiques
the HafenCity. The purchaser, Real I.S., and specialist businesses.
a subsidiary of the Bayerische Landes-
bank (Bayern LB), paid vendor Black- In this context, developers, investors and
stone just under € 190 million for the brokers are focusing on the increasing
mixed-use property with offices, shops number of new construction areas being
and apartments. created in local neighbourhoods –for ex-
ample the “Unter den Linden” residen-
BOROUGH CENTRES ON THE UP tial district in Langenhorn, where 850
The sale of the “LaHoMa” district shop- apartments are being built on the for-
The LaHoMa is supposed to
ping centre, comprising retail and gast- mer site of a hospital. With its purchase
be the new quarter centre ronomy, medical offices and service are- of the Berliner Platz shopping centre in
of Langenhorn.
as and also apartments, developed in Hamburg-Jenfeld Matrix has already se-
Langenhorn by Matrix and SEGDevelop- cured its next development site, located
ment for well over € 100 million is typical near to the Jenfelder Au new residen-
of two further important trends on the tial district.
investment market. Firstly, mixed-use
properties have become an established This trend in the boroughs is also con-
feature of investor portfolios, moving firmed by figures released by the Ham-
20Commercial Investment
Wohldorf-
Ohlstedt
Duvenstedt
burg Committees of Valuation Experts SALES IN THE DISTRICTS IN 2017 None
Lemsahl-
on the distribution of sales of office and Mellingstedt 1
commercial properties in 2017. Langen- Bergstedt
2
horn, for example, recorded 11 tran- Poppen-
büttel
3
Langenhorn
sactions, the second-best result in the Sasel
4
Hummels- Volksdorf
district ranking – behind Harburg with büttel
Wellings- 5 to 6
büttel
Schnelsen
13 transactions. These districts were Niendorf
Fuhlsbüttel 7 to 9
Ohlsdorf
followed by Hammerbrook/City Süd (11 10 and more
Rahlstedt
transactions) and Bergedorf (10). In a Eidelstedt
Groß
Borstel
Alster-
dorf
Steils-
hoop
Farmsen-
comparison over several years St. Pauli Lokstedt
Bramfeld Berne
Lurup Eppendorf Barmbek-
(9), Finkenwerder (7) or Heimfeld (6) also Stellingen Winterhude Nord Tonndorf
Rissen Hohe- Duls- Wands-
achieved above-average results. Sülldorf Iser-
brook Eims-
luft
Harveste- Barmbek-
berg bek
hude Süd Jenfeld
Osdorf Bahrenfeld büttel
Uhlenhorst
Sternschanze Eilbek Marienthal
Rotherbaum
Blankenese Groß Altona Hohen-
COMPETING USES Flottbek -Nord St. felde
Neu- Georg Borg-
Nienstedten St. stadt Alt- felde Hamm Horn
In recent years the city centre with the Othmarschen
Otten-
sen Altona Pauli
-Altstadt
stadt Hammer-
brook Billstedt
Altstadt (7) and Neustadt (10) districts, Cranz
Finkenwerder HafenCity
Rothen-
Waltershof Steinwerder burgsort
traditionally a front runner, has decli- Kleiner
Grasbrook
Billbrook
Veddel
ned in importance. This is a reflection
Neuenfelde Altenwerder
of both the scarcity of offerings and also Francop
Moorfleet
Lohbrügge
Billwerder
the widening gap between office and re- Wilhelmsburg
Taten-
Moorburg berg Neuallermöhe
tail space performance, which is beco- Spaden- Bergedorf
Neugraben- land Allermöhe
ming ever more apparent on the mar- Fischbek
Hausbruch
Reitbrook
ket. Parallel to this, there are also other Heimfeld Neuland Ochsenwerder
Harburg
Curslack
competitors for space in the city centre, Neuengamme
Eißendorf
namely hotels and – in future – city-cen- Wilstorf Gut Moor Altengamme
Marmstorf
tre logistics operations. Rönneburg
Kirchwerder
Sinstorf Langenbek
OFFICE REAL ESTATE
Office space is in demand – from inves-
tors and from tenants, with office space Source: Property Market Report 2018, Gutachterausschuss
zinshausteam-kenbo.de 21
Keine
1Commercial Investment
take-up reflecting Hamburg’s diversified figure space was with the Signal Iduna
economic profile. In the first half of 2018 insurance company – an interim solution
no one single sector achieved a share for 10 000 m² in the Vattenfall building in
exceeding 20 % of take-up. Logistics, City Nord. The second-largest transac-
public authorities, insurance/banking, tion illustrates the co-working companies
industry and construction & real estate are becoming an ever bigger force to be
were the top five sectors. At some 250 reckoned with – Design Offices will oc-
000 m², take-up in the first half of the cupy 8 600 m² at the Olympus Campus,
year is below the record figure for 2017, currently under construction, also as a
The largest single however the decline has been caused by puffer space for Olympus. Also in the City
property transaction in the scarcity of offerings, not lack of de- Süd district, at the Economic Center in
Hamburg‘s investment
history: The „Springer mand. The vacancy rate correspondin- Heidenkampsweg, municipal company
Quartier“ project gly fell to approx. 4 % – the lowest level f&w fördern und wohnen leased just un-
since the new economy boom of 2001. der 8 600 m², while the largest contract
Hamburg currently has less than 600 concluded in the city centre was by the
000 m² of vacant office space, a figure Zeaborn shipping company, founded by
which is lower than that for annual office Kurt Zech, for 5 300 m² in the Tower am
take-up – for example over 600 000 m² in Michel building.
2017. The room for manoeuvre available
to expanding companies is thus severely MIXED USE CAUSES SUPPLY
limited – in particular against the back- SHORTAGES
drop that any specialist employees who The availability of office space will not
are recruited have high expectations as improve in the next two to three years.
regards their workplace. This applies to Some 320 000 m² of office space will be
both office furnishings and also to the completed in 2018 and 2019, however
urban flair of the surrounding area. just under two-thirds of this space has
already been let. New projects are not
Turnover has thus been achieved with vir- actually creating large amounts of office
tually no large-scale transactions. The space. This is particularly the case for
only rental contract concluded for a five- popular city centre locations. Although
22Commercial Investment
PRICE INDEX FOR COMMMERCIAL INVESTMENT PROPERTIES
LOCATION MICRO-LOCATIONS UNDER DEVELOPMENT MULTIPLIER TREND
27 - 32 times
City Kontorhausviertel, Nikolaiviertel, Springer Quartier annual rent
25 - 29 times
HafenCity Baakenhafen, Elbbrücken annual rent Ò
22 - 28 times
Eimsbüttel, Eppendorf, Hoheluft annual rent Ò
22 - 27 times
Hafenrand annual rent Ò
22 - 26 times
St. Georg, Uhlenhorst, Winterhude (City Nord) Überseering annual rent Ò
21 - 26 times
Hammerbrook (City Süd) Nordkanalstraße, Sonninstraße, Spaldingstraße annual rent
20 - 27 times
Altona, Bahrenfeld, Ottensen, Sternschanze, St. Pauli Gasstraße, Neue Große Bergstraße, Diebsteich annual rent Ò
23Commercial Investment
projects such as the Springer residential CO-WORKING INCREASINGLY
district; new construction on the former POPULAR
site of the Commerzbank or the Burstah Co-working companies have been pre-
Ensemble on the former Allianz premi- sent on the market since 2017 and are
ses in Großer Burstah are creating more financially strong competitors for scar-
gross floor area (GFA), they are not crea- ce large office spaces in the city centre.
ting more office space than previously Such companies are expanding signifi-
available. To obtain planning permission cantly although projects dedicated so-
for enclosed plots developers must ful- lely to co-working are relatively rare.
fil the goal of creating a mixed-use city Companies such as WeWork, Mindspace,
by including housing and office space in Spaces or Design Offices, strongly re-
their plans as well as integrating a hotel, presented in Hamburg, provide a mix of
retail or communal use areas. The con- separate offices, as offered in business
sequence of this is that modern, needs- centres, with open-plan areas shared by
oriented office space is coming onto the various users (sharing spaces).
market, however the volume is not much
larger than previously. Office space is be- In 2017 almost 50 000 m² were leased
coming ever scarcer and more expensive. in Hamburg alone to set up such fle-
This applies both in terms of rents, which xibly usable office space. Contracts for
can be up to € 27/m², and purchase pri- just under 25 000 m² have already been
ces. Yields and vacancy rates are falling concluded in 2018, with the focus on the
at the same rate. The Hamburg Com- city centre.
mittees of Valuation Experts identified
an average yield multiplier (yield) of 25.1 LACK OF SMALL PROJECTS
for office and commercial properties in Office space is becoming increasingly
the city centre in 2017. Maximum yields scarce and – other than is the case for
– for example for the Kaisergalerie office large-scale projects – there are few
and retail complex in Große Bleichen – smaller development projects to reme-
of over 30 times the annual net rent are dy this situation. Developers working on
thus being achieved. refurtohment projects are looking for
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