Commerz Grundbesitz Group Expands its Commitment in Sweden

Yesterday, Commerz Grundbesitz Group (CGG) signed the contract for a shopping centre in Malmö, and strengthened intensified its commitment in Sweden. The Malmö Entré shopping centre represents a project development that is scheduled to be transferred into the real estate portfolio of hausInvest global, one of the openended property funds managed by the Group.

The object is sold by the largest Danish real estate developers, TK Development A/S, who will bear the entire construction, licensing and construction scheduling risks up to the project’s completion in late 2008. Altogether, the investment costs approximate Euro 176 million. The object yield will exceed 6% after taxes and costs in the ten-year mean.

With regard to the transaction CGG was advised by the consulting departement of Jones Lang LaSalle Stockholm.
Once completed, the Malmö Entré will cover about 39,000 m² rental space. Even now, the development reports a forward commitment quota of about 50%. The building is located in the northeast of downtown Malmö, and has excellent connections to the public transportation networks, a factor of particular importance for retail spaces. With a floor-to-ceiling height of 15 to 21 metres inside the mall, and a high share of daylight, the Malmö Entré differs markedly from other shopping centres in Scandinavia.

Malmö is Sweden’s third largest city, after Stockholm and Göteborg, and simultaneously the seat of Skane County. The catchment area of the shopping centre extends into the surrounding region with a population of about 700,000, the greater Malmö area being the most affluent region in Sweden. According to a forecast by the research department of Jones Lang LaSalle, the spending power will increase by 24% up to Euro 4 billion by 2011.

A look at the above-average positive development of the Swedish economy confirms this assumption. Thus, the Swedish National Institute of Economic Research expects an economic growth of 3.7% for 2006, which compares to an average growth of just 2.2% in the 15 EU countries. Consumer spending also reports a positive trend: Since the beginning of 2006 alone, the consumption of private households rose by 3.2%, tendency rising.

“With the investment in Malmö Entré, we will stabilise the income structure of hausInvest global, and strengthen the European share of the real estate portfolio. At the same time, investors will benefit, through a combination of fixed rents and turnover rents, from the positive development of the Swedish economy, specifically from the great turnover increases in the retail business,” says Dr. Frank Pörschke, Chairman of the Board of Managing Directors of Commerz Grundbesitz Group. Upon completion of the project, the Group’s Swedish holdings in managed real estate assets will total approximately Euro 700 million. This positions it among the biggest foreign investors in the country.


About Commerz Grundbesitz Group

Founded in 2001, Commerz Grundbesitz Group counts among the global leaders in real estate asset management, managing open-end property funds along with special property funds and REITs. The Group currently manages real estate with a volume of more than Euro 13 billion worldwide. With foreign real estate assets worth more than Euro 10 billion, and a gross lettable area of approximately 3.5 million m2, Commerz Grundbesitz Group is one of the largest European real estate investment houses.

The Group includes Commerz Grundbesitz Investment GmbH (CGI), a capital investment company founded in 1992 and managing the Group’s retail funds. Among these, hausInvest europa represents the market leader in the open-ended property funds industry, having a Fund volume of more than Euro 8 billion. In March of 2004, CGI started hausInvest global, a fund with investments worldwide and a fund volume already worth more than Euro 1.1 billion. The market share of CGI in the overall volume of mutual real estate funds currently equals more than 12%. So far, more than 450,000 investors have invested in CGI funds.

Contact

Dietmar Müller
Press Spokesman
Commerz Grundbesitz Gruppe
Kreuzberger Ring 56
65205 Wiesbaden, Germany
E-Mail: dietmar.mueller@cgi.de
Internet: www.hausinvest.de
Phone: +49 (0) 611 – 7105 – 385