Gutburg, Germany

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About the asset

The Gutburg real estate portfolio consisted of apartment buildings with approximately 8,500 individual apartments across eight cities in the populous state of Saxony in Eastern Germany.

In the central locations of the Gutburg portfolio (Leipzig, Brandenburg, Cottbus), the purchasing power increased from the early 2000s due to the development of new industries and the relocation of manufacturing facilities, like BMW and Porsche. Today, the region has also benefitted from the influx of new light industries ranging from logistics to solar energy technology.

The real estate portfolio underwent significant redevelopment during 2013 to improve the overall quality of the properties that included the upgrading of apartments, staircases and public areas to include installing playgrounds, elevators and ramps of easier access.

Even though the region has seen significant economic development, unemployment remains above the German average. It is a crucial factor taken into consideration during the redevelopment to ensure that rental rates remained affordable, attracting young families and maintain a low level of rental defaults. In turn, this improved tenant turnover and the overall rental incomes across all properties.  

Facts & Figures

  • Asset purchased in 2013
  • Status: sold in 2015
  • Deal Type: Redevelopment & Repositioning
  • 8’500 residential units
  • Locations: Across 9 cities
  • Partner: Gutburg Immobilien

Infrastructure

At the macro level, the locations offer the typical amenities and facilities that can be found in any larger city. The increased economic development across the region has also supported broader infrastructure expansion of the road, rail and airport network.

On the micro-level, careful consideration was given to improving the quality and functionality of the apartment blocks and apartments but maintaining a level of affordability to attract and retain families.

ESG considerations

Lakeward went the extra mile to ensure that the redevelopment had a positive social impact on the community as a whole. Active engagement with the tenants to ensure family-friendly apartments at a level of affordability to ensure stable and loyal tenants. Also, Lakeward worked closely with developers and partners to ensure responsible development following local and national planning, development and construction regulations.

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