The German real estate investment market was able to continue in 2020 despite the corona pandemic
maintain a high level. Compared to the record year 2019, there was a total of
Notwithstanding, transactions moved on a
stable high level.
The real estate market is crisis-proof
From the crisis year 2020, the German investment market for real estate is clearer
Winners. As can be seen from a CBRE study, the investments are in comparison
the record year 2019 declined by 5.5 percent, but 2020 as a whole
The 79.2 billion euros invested mark the second most successful year in history.
“In 2020, the real estate investment market proved to be immune to the even without a vaccination
Pandemic and its effects. […] German and international demand
Investors in local real estate remains strong, ”comments CBRE Head of
Investment Germany, Fabian Klein, in the course of the study.
A trend away from commercial real estate towards residential real estate was evident. Though
always represented commercial properties with a volume of 59.2 billion euros
still the sector with the highest investment in the real estate industry, compared to
However, the previous year’s result shows a decrease of 12 percent. Meanwhile
the investment volume on the residential investment market rose by 23 percent to 20
Special funds and open real estate funds were the largest investors
Above all, large-volume investments ensured that even during the Corona crisis
stable real estate investment market. The 162 large-volume transactions alone – from 100
Million euros – recorded an investment of 47 billion euros, with the 68
parcel sales with a volume of 30 billion euros were around 64 percent
made of this.
As the largest investor group, the CBRE study was able to identify special funds as well as open
Real estate funds determine, they invested 12.2 billion euros in the German in 2020
Real estate market. Pension funds and insurance companies were involved in transactions of
4.6 billion euros the second largest investors. The underlying fund and
Asset managers were responsible for transactions with a total volume of 1.8 billion euros
The investments made by foreign institutions amounted to around 37
Billion euros, which corresponds to a market share of 47 percent.
Fewer transactions in Germany’s top cities
Investors were most active in the federal capital Berlin. The investment volume
amounted to 10.5 billion euros, followed by Frankfurt am Main with 7.7 billion
Euros and Hamburg with 6.4 billion euros. In fourth and fifth place – with regard to the
Investment volume – in 2020 Munich (5.5 billion euros) and Düsseldorf (3.9
In a year-on-year comparison, however, this only increased in Hamburg (plus 28 percent)
Investment volume, whereas in all other cities the top 5 decreased
was to recognize. Overall, investments in Germany’s top 7 cities in 2020 amounted to high
of 36.5 billion euros, which is a decrease of 26 percent compared to 2019
In terms of investment, commercial real estate had a few last year
Take setbacks, but still mark them with an investment share of 35
Percent, or 27.6 billion euros, remains the largest asset class. Behind
residential real estate with a share of 25 percent – 20 billion euros – and
Retail and logistics properties with market shares of 15 and 10 percent – i.e. 12.3
or 7.6 billion euros.
The big winners in 2020 were residential real estate, which generated increasing demand
however, for higher prices, so that the prime yield is a value of 2 percent
approaching. Office properties have been in terms of prime yield over the past year
The big loser of the year, these are on one with a return of 2.85 percent
All time low.
Residential properties are trendy
For the current year, the experts at CBRE continue to forecast a high one
Investment level, with office real estate still dominating the market. The
The increasing use of home office does not affect this. “For 2021 we expect a
Transaction volume on the German real estate investment market of well over 70
Billion euro. The decisive factor for this will be primarily the product availability, but also
the continued success in the fight against the pandemic, ”explains Klein.
The crisis is also an occasion for investors to increasingly move into stable office properties
invest and that both in the established metropolises and in the so-called B-
Locations. Nonetheless, one expects a trend “towards living, health
and social real estate as well as logistics and light industrial, ”comments Klein.
The increased demand in these areas will, however, be due to the increasing demand
Prices ensure a lower return level, which is still above that of
fixed-income securities will be, explains Klein.
Image sources: Shutterstock.com / frank_peters