Property Consulter Germany - specialized in selling property for people from English speaking countries

Investment opportunities in Germany

Office buildings
Two cities are currently offering outstanding prospects, where investment in office buildings is concerned: Frankfurt and Munich. Both cities have eased through the low-rent trough, and even at this low level are now offering an attractive profit margin on for example new buildings. Unoccupied office spaces in Frankfurt is disappearing, while Munich, with less than 2 %, has virtually none left. Both cities represent substantial growth regions with their surroundings, both from an economic and from a population development viewpoint. Frankfurt is gaining in popularity in the field of accommodation thanks to support from the European Central Bank headquarters and its intention to establish the European banking- and stock-exchange centre there. Munich's trump card is, as ever, its attraction as a place to live. This has already drawn many innovative companies, wishing to offer their employees life in the popular city of Munich, with its variety of leisure opportunities. And the companies that are already there are attracting more new ones.

Retail buildings
Rent levels of retail space of 1b locations is continuing to flag, by comparison with 1a locations, and empty premises are on the increase. For this reason, only investment in 1a locations can be recommended at present; availability is, naturally enough, scarce.

Residential properties
Returns on living properties have been inferior to those of commercial properties over the last few decades. The present stagnation of rents in most towns and cities currently cannot prompt any activity. Recently-passed laws are tending in the direction of tenant-protection. Consequently, in view of this, the high cost of administration and the fact that property in Germany is in any case relatively expensive, investment in living properties can be recommended only in very special cases. Where very large-volume properties are concerned, one must mention the properties currently being disposed of by public bodies and the former state undertakings. In this area, there is a good chance to make a profitable investment, through the rent levels - often under market levels - and the usual reduction on account of the property volume. Where smaller-volume properties are concerned, no general recommendation can be made.

Project developments
Because of the large number of potential buyers of developments in Germany, this is an interesting field of activity for project development specialists. Similarly to above, Frankfurt and Munich are of particular interest here for office buildings. For retail buildings, the 1a locations of the roughly fifty largest towns and cities in the old federal states (onetime West Germany) are of particular interest.

Property shares
Previously, Germany only knew a limited number of property shares, which, on account of their administrative business direction, were only moderately profitable, and therefore not very attractive for investors. Meantime, however, many new property companies have been formed. Some of these have been able to put up a very impressive performance. Generally, the German property companies are extremely diversified; specialised ones are very much the rarity. This could be the starting point of a promising investment; namely, founding of specialised property companies, or re-direction of existing ones. After all, everyone knows that share values are very much a product of profit expectations. And with specialised property companies one can on the one hand expect bigger profits as a result of greater effectiveness. On the other hand, at the price of increased risk, one can reasonably expect bigger advances in profits, there being no compensation with other property areas.