Foreign investors take a punt on world cup winner

Photo: Alexander Steinhof

The turnaround is significant: in 2009, German property generated €10.5 billion of property deals, according to CBRE. Last year, that had almost trebled to €30.4 billion, with predictions this year that it will jump to more than €35 billion, 15 per cent higher than 2013. Indeed, in the first half of 2014, investors splashed €16.9 billion on commercial real estate, explains eFinancialNews, 27 per cent higher year-on-year.

The German real estate market is now increasingly competitive, according to CBRE. Indeed, local buyers were once the biggest players on the pitch. As Germany won new fans abroad with its performance in the footballing tournament, its housing market has achieved the same feat with buyers.

Buyers are now flooding in from as far afield as China and the Far and Near East, the firm tells Welt.de

Savills says 15 per cent of investors are from the US, with 11 per cent from the UK and 9 per cent from France. Either way, it is a major shift from last year by, when Anglo-American buyers dominated overseas interest.

In 2003, just 25 per cent of investment cames from outside of the country. Marcus Lemli, Savills’ chief executive in Germany, explains: "It took time for foreigners to enter Germany to set up their funds and partners and to get their structures in place."

Domestic and overseas investors now account for half of the buying activity each, says CBRE, with shopping centres and office spaces particularly popular.

The firm argues that where once Germany's size and regional variation between its multiple property hubs were intimidating to buyers, now investors welcome the diversity, boosting office take-up and rents across a range of major cities.

Christoph Ignaczak of investment firm Patron Capital Partners adds to eFinancialNews: “Everybody is chasing assets in Germany and competition is really high, with US hedge funds and private equity funds all wanting the same type of building. We like the top seven cities in Germany but we can’t always buy in the top cities so we look around B cities as well as East Germany,” he said.