Property hotspot Berlin

According to many studies, Berlin is the leading city for investment prospects in 2015 in Europe. Housing is one of the most attractive asset classes for investments. But the demand for commercial and special-purpose properties is also high. So a Canadian major investor has just acquired 17 properties in premium location at Potsdamer Platz.

by Peter Guthmann Published on:

Berlin remains an absolute favorite for residential investment. Numerous studies have shown that the German capital is one of Europe's most attractive property markets. On this PwC and the Urban Land Institute and Ernst & Young Real Estate GmbH interviewed fund and investment managers, institutional investors, real estate companies and investment companies.

15 years ago, investors have not expected today's development of Berlin. Especially the years between 1995 and 2001 were marked by population decline and suburbanization. At that time, it attracted many residents out of the city, into the "commuter belt" to Brandenburg. Today nobody is thinking about this development any longer. The advantages of Berlin are known far beyond the German borders: best location factors, agile arts and culture landscape and a fashion location.

With the intense influx from other German regions and abroad, the capital is gaining more and more attraction. Thus, the pressure on the property market is growing by the increasing demand. Therefore investors expect to at least 2030 further rising property prices in Berlin. In addition, the continuing low interest rate drives up the volume of transactions in the property market. According to the studies of E & Y and PwC the risk disposition of investors is increasing significantly.

Even for large-scale investments Berlin is an attractive location - mainly for financial investors from Asia and North America. In recent years, Berlin experienced a previously unknown dynamics, driven by many start-up companies, start-ups in the tech sector and the establishment of government enterprises.   

The most recent example of the confidence of major investors in Berlin is the acquisition of 17 properties at Potsdamer Platz by the Canadian investor Brookfield. This transaction includes a total area of 270,000 square meters. These areas encompass, among others, the Mandala Hotel, the Stage Theater and the cinema Cinemaxx. Previous year Brookfield, one of the largest property managers worldwide, acquired the hotel property "Park Inn" at Alexanderplatz. In the press we read, the investor sees significant appreciation potential, especially in view of the current top prizes in Berlin.

To sum up, Berlin properties are still in strong demand; both from national buyers as well as international investors. We are expecting a further increase of the property prizes in Berlin.