pa trizia live - PATRIZIA Immobilien AG

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pa trizia live - PATRIZIA Immobilien AG
PATRIZIA
L IVE
LONG
O
EUR
k With over 600 employees on staff, PATRIZIA is active
PATRIZIA Immobilien AG
PATRIZIA Bürohaus
Fuggerstraße 26
86150 Augsburg, Germany
Phone +49 821 50910 - 000
Fax +49 821 50910 - 999
[email protected]
www.patrizia.ag
on the real estate market as both an investor and service
provider in more than ten countries. Over nearly 30 years,
the spectrum of services offered by PATRIZIA has grown to
include the buying, administration, value appreciation and
sale of private and corporate real estate. As a recognized
business partner to large institutional investors, the
company works nationally and internationally, covering the
complete real estate value chain. At present, the company
oversees real estate assets totaling nearly € 7.5 billion,
80 % of which is attended to on behalf of third parties,
mostly insurance companies, pension fund institutions,
sovereign wealth funds and mutual savings banks. Through
its capital investment companies, PATRIZIA GewerbeInvest
KAG and PATRIZIA WohnInvest KAG, PATRIZIA establishes
specialized real estate funds based on German investment
law, making it one of the most attractive partners in the
German real estate sector.
PE
2
Contents
Mixing the
right ingredients
Would that be pickled onion with your Nutella?
Ketchup with mayonnaise? Sweet and sour? Variety
is the spice of life, not just food – and the same
applies to nationalities.
26
Unified breakfast –
United Europe
Brave
new cities
36-24-36!? Europe’s next catwalk city model
will have to have the looks, be adaptable,
kind to others and enjoy diversity. There
are also minimum age requirements.
8
You are what you eat. Wladimir Kaminer knows
what the Europeans want to see on their breakfast
table – always an area of potential conflict.
4
The pain of rejection Poor old Europe is really wrestling with her destiny. Once so desired
and sought after, she’s now discovering that the big continental men
are more in love with themselves. What’s happened? An alternative
A special sorcerer for Europe
36
18
“We’ve set something in motion that we can’t get out of anymore.”
Peter Scholl-Latour discusses the commonalities between modern
Europe and the Sorcerer’s Apprentice described by Goethe.
22
kind of marriage counseling.
Own your own home! Very European:
PATRIZIAns write home
The Germans are sluggish buyers, especially when it comes to homeowning. Marcus Cieleback examines the purchasing habits of the
Germans and their most obvious implications.
12/24/34
The postcards from France, Sweden, Austria and England paint a
clear picture: Though PATRIZIA is making the big move to other European countries, its employees have been exploring for decades.
Bad, worse, worst 14
It’s like the film “Independence Day” for owners of European real
estate. Björn-Martin Kurzrock describes the worst case scenario –
collapse of the monetary union – only this time we can’t expect help
from Will Smith.
Published by: PATRIZIA Immobilien AG | PATRIZIA Bürohaus | Fuggerstraße 26 | 86150
Augsburg | Telephone +49 821 50910 - 000 | Fax +49 821 50910 - 999 | [email protected] |www.patrizia.ag Liable under press law: Andreas Menke (head of communications)
Produced by: vmm wirtschaftsverlag gmbh & co. kg | Augsburg | www.vmm-wirtschaftsverlag.de Articles written by: Monique Berchtenbreiter (Editor-in-chief), Dr. Marcus Cieleback,
Julica Jungehülsing, Wladimir Kaminer, Dr. Björn-Martin Kurzrock, Barbara Ottawa, Andreas
Theyssen, Gayle Tufts, Bernhard Wild, Simone Wipplinger Graphic: Anne Gierlich Images
provided by: Front cover © akg-images/Ehrt | Eboy Arts Inc. Vancouver| Fotolia | photocase
(suze/jottkah) | Illustration S.Wilharm, 'Der Zauberlehrling' © Kindermann Verlag | picture-
Not just stable, solid:
welcome to northern Europe 30
According to economic journalist Bernhard Wild, northern Europe is
enjoying the sunny side. Not necessarily where hours of sunlight are
concerned, but more in terms of real estate markets.
La Réunion – Europe`s exotic extremity 40
Sun, sand, sea – the stuff that dreams of made of, in the Indian Ocean. Far from Europe, yet center stage. La Réunion was the first place
that people were able to pay for goods with euros.
alliance/dpa/dpaweb | INTERFOTO/TV-Yesterday | Cinetext Bildarchiv | WDR| Anne Gierlich | getty images (© Sylvester Adams) | PATRIZIA Immobilien AG Printed by: AZ Druck und Datentechnik, Allgäu Consultation/English text adaptation: englishtalk GbR, Stuttgart Disclaimer:
This magazine serves to supply information only and does not constitute a call or invitation to
buy, sell, or otherwise trade securities or other special items relating to PATRIZIA Immobilien
AG. The information and facts contained in this magazine serve the purpose of providing an
overview of the company for information purposes. Claims relating to securities may not be
made as a consequence of any of the information provided in this magazine.
3
Editorial
kk
There’s more to Europe...
... than just a continent. And the European Union is
much more than an economic and political accord
between 27 countries. It’s a concept. To some, it’s
even a vision. Indeed for more than 500 million people, at least within the EU, Europe is a solid foundation that sustains living in statehood and peace, with
freedom of expression – just as it has for over half a
century, something that has now even earned the EU
the Nobel Peace Prize.
For many – who like me still believe in the grand
concept of multi-cultural cohabitation on a European
continent sans frontiers – the peace prize could
hardly have come at a better time. Maybe it will help
Europe, so often chastised, so economically bruised,
so rattled in its foundations, to rediscover a new selfconfidence. But maybe this award will also prompt
us all to consider that there’s more to “Europe” than
just economic growth and the “euro.” This is what
people talk about most, but only because these are
the most conspicuous outward signs of European
union. No, there’s more to Europe. Much more.
And it’s precisely this “more” – that which becomes
so apparent when one mulls over Europe, the many
things that are scarcely pointed – that we’d like to
look at more closely in this, our latest edition of estatements magazine. Our authors and interviewees
shine a light on Europe from a variety of angles, painting a picture that may certainly be critical, yet is still
optimistic, such that overall, several aspects shine
through: Europe is colorful, captivating through its
contradictions, liberal in outlook, democratic in character, humanistic in its values.
Europe is a grand “location” for enlightened, independent people who value a life of liberty and are
also prepared to make their own contribution, so that
a concept succeeds that in its very essence is unique
the world over. Personally, I’m convinced it’s worth it.
And it’ll pay.
Wishing you an enjoyable read
Wolfgang Egger
CEO, PATRIZIA Immobilien AG
2
3
The Pain
of Rejection
Europe is no longer en vogue. As
in any relationship, problems great
and small can create cracks in the
canvas, causing us to lose sight of
the bigger picture. A monologue
from Europe’s perspective.
4
W
hat’s going on? What happened? Where is the love we
shared? Faded. Vanished into thin air. The essence that was
once the making of our relationship is now no more than a
memory. And anyone who dares reminisce about these memories is subject to ridicule. Much like the committee that recently bestowed upon
me, Europe, the Nobel Peace Prize. I’m no longer that one, true love; I’m
a laughing stock. How could this happen?
The days when great men vied for me lie only a few decades back.
Charles de Gaulle, Konrad Adenauer, Jacques Delors, even Helmut Kohl,
a man who played the part of the down-home Palatinate native, but who
loved me like no other German. They all courted me, they loved me, they
wanted me.
"Europe is a question of war and peace," Kohl once expressed, showing
his deep admiration for me. All these great men of European politics
had experienced first-hand how the countries of this continent tore each
other apart in two world wars within the scope of three decades. But
then I came along – Europe’s unifying force – and the enemies of old
became partners, I dare say, friends. They lived together, in peace, and
also in prosperity. I brought down customs barriers, allowed for goods
to flow more easily, and particularly Germany benefited from unhindered
exports.
I was so attractive that Eastern Bloc countries turned to me in a hurry
once the iron curtain fell: the people of Poland, the Czechs, the Slovaks,
the Balts, later even the Romanians and Bulgarians. Even the Turks, who
primarily lived in the Middle East, wanted to be a part of me. How aggrieved they felt when their love was returned, unrequited, especially
by the German Europeans. Today even the Turks’ love for me has
grown cold; a half-hearted flirtation.
5
The leaders of the continent once held a love for me that was so great it
led them to make a big mistake – with eyes wide open. Not maliciously,
but rather to prove their love to me. They introduced the Euro, knowing
full well that a common currency could only come at the end of the European process: not before the political and economic unity had come to
pass. The decision had little to do with common sense and reasoning. It
was merely a token of love. A token that is fated to be my doom in these
days of uncertainty amidst the Euro crisis.
The mighty men of Europe, primarily Helmut Kohl and Francois Mitterand, took their love further to invite Greece and Italy to join the Euro
zone. All the while they knew that these two countries didn’t meet the
criteria of the Maastricht Treaty; that they tended to be a bit creative with
their economies and with their budgets. “A trifle,” thought these great
men. This was a matter of true love.
The intentions were so good, yet the decisions were so foolish. When the
“continentals” talk about me these days, you hear nothing of love, freedom, peace or prosperity. No, it’s all about austerity, economic crisis,
unemployment. Sometimes even of anger and pure despair.
The relationship between me and the great men of Europe has turned
sour. No doubt they loved me, but they loved themselves much more.
To help me become truly great, they should have given me more power.
Democratically legitimate power with a parliament that could supervise
a European government. One that could better channel the skills of the
continent. But to do this, these great men would have had to give up
some of their own power. And that was something they weren’t willing
to do.
And so it goes that everyone has a say these days. A little bit comes from
Parliament, some more comes from the Commission, but most contributions come from the 27 heads of state – people who cannot readily
agree on anything. Then there’s the council president and a representative for foreign affairs, but nobody knows much about them, what they
actually do, or to what extent they have a say in things. Nothing is transparent, there’s no clear overview and things seem undemocratic. This
chaos – chaotic structures and responsibilities – makes me incredibly
unattractive to those who should love me most. And I can understand
that. The way I look these days, it’s even difficult for me to love myself.
It’s mostly the Commission’s fault. While it’s supposed to act as a governing body for Europe, it’s more of an unwieldy apparatus of highly paid
civil servants working towards horrendously high pensions. It just seems
to muddle along somehow, taking care of petty things like standardized
plugs for charging devices, quotas in supervisory councils, and, as rumor
has it, the curvature of bananas. That’s technical, bureaucratic, and it
borders on nitpicking. But most of all, the Commission sees to it that
I look bad. Who can think of peace, freedom and prosperity when all
that’s talked about is blending quotas, bioethanol or decommissioning
premiums for farmers?
It’s like in any relationship: In arguing over money and trivial things like
open tubes of toothpaste and toilet seats, we lose sight of the essentials,
forgetting what it was that made us vow to stick together. Love takes a
back seat to the grueling daily grind and monotony of the day-to-day.
Sometimes, it’s lost completely.
That’s what we’re facing today. The people of Greece, Portugal and Spain
curse my name; scorn it in the same breath as Troika and Merkel. The
Brit’s latent aversion toward me is now a matter of public display. And
Germany treats me as if I were a prostitute: too expensive, they say.
The European states should be able to consult an upper house – similar
to a federal council – in matters concerning their national interests, if
these are affected by decisions made by the European government. The
principle of unanimity, where Malta has as much say as France, can no
longer be supported. Instead, each country should have a voting weight
that falls in line with its population size.
Only through such radical reform measures will I be able to shake the
bad reputation of being a bureaucratic monstrosity. It’s the only way I
can become a true daughter of democracy. It’s the only way forward
to give the citizens of this continent the feeling that they have a say in
European politics. It‘s the only way to help them rekindle the love they
once had for me.
My sacrifice: I will lose my name. No longer the European Union, I would
be called the United States of Europe. But that would be just fine with me.
v
Andreas Theyssen
So what’s to be done when a relationship is at the brink of breaking up?
A trial separation? That won’t work. Wouldn’t it just spell a very certain
end? What about consulting a marriage counselor? But who would that
be? Seen globally, no one can give advice based on experience because
I am a very unique experiment – something attempted by the states of
southeast Asia, the Gulf region and Latin America; but even that is lost.
No. Something has to happen to effect fundamental change. It’s time to
eliminate the petty things so that we can gain sight of the essentials; the
things that led to my being loved.
I’m tired of this hybrid existence. I have to become a true democracy.
It’s time the Europeans vote-in a parliament with Europe-wide political
parties. To be selected from its ranks: a European Prime Minister responsible for assembling a cabinet where ministers aren’t selected based on
proportional representation, but by qualifications. This government must
be monitored by the parliament to abide by comprehensive economic
and budget policies, so that countries who keep their house in order
don’t pay for countries that live beyond their means.
k ANDREAS THEYSSEN
Andreas Thyssen (51) recently worked for the Financial Times
Germany (FTD). After 2006, he was director of the policy department
and contributed as a columnist to the opinion pages. Before this, he
was editor-in-chief of FTD's front page and an editorial writer. Other
positions he has held include: editor, correspondent, department
manager, and chief copy editor in Munich, Berlin, Hamburg, Dusseldorf, and Beijing for weeklies and daily papers such as Die Woche,
Munich's Abendzeitung and the Süddeutsche Zeitung. His most
intriguing position to date: serving as a GDR-correspondent during
post-Berlin Wall reunification.
8
9
Brave
new cities
Some might argue that the European cityscapes of the future won’t be remarkably different from how they look today,
while others are putting their money on science fiction.
W
e all agree: European cities are beautiful, historic, small. In
fact, China has even taken to building duplicates as tourist
attractions. But with their narrow alleyways and protected
historic city centers, do they fall in line with our visions of the future?
As a paper commissioned by the European Union regarding “Cities of
Tomorrow” puts it: “Cities must build upon their past in order to meet
the needs of the future.” In doing so, the blending of many different
areas of a city, including its historic downtown area, lends it a unique
attractiveness.
Prof. Dr. Ing. Vittorio Magnago Lampugnani from the Zurich-based Swiss
Federal Institute of Technology (ETH) is convinced that historic cities can
already be counted as “some of the best models for planning the cities
of the future. They are compact, designed for pedestrians, and offer a
wonderful blend of working and living areas, as well as plenty of leisure
facilities.” This is “irreplaceable” – and definitely can’t be matched by
the “cities of science fiction.”
But this is precisely what people do tend to imagine when they think
about the cities of the future. Oddly, Europe never jumped on the megacity bandwagon. So it never developed cities that rival those in Asia or
Latin America. Lampugnani, a professor of architecture, explains this anomaly in two ways: “One can’t compare demographic pressures in Europe to that of, say, Mexico City, Shanghai or Jakarta. Sure, even in Europe
there are higher population concentrations in metropolitan areas, but we
have a wide cobweb of conurbations, all of which are very attractive.”
This is rooted in history: Regal cities and seats of power in the kingdoms
of the Middle Ages were the central hubs of the day. This significance
first shifted toward port cities like Venice and Genoa with the advent
of seafaring trade, then later transferred to the capital cities of the two
strongest colonial powerhouses: England and France. In the course of
industrialization, manufacturing cities marked the maps, albeit with a
shift of emphasis in terms of economic activity. k
11
According to data issued by the European Commission, 75 percent of
Europeans already live in cities, where 85 percent of the gross domestic
product is generated and 80 percent of energy consumption is accounted for.
According to the Canadian architecture critic Jane Jacobs, at the heart
of a city lie the “old, grown districts with their history.” It is this tradition
that the European Union is striving to preserve. Outlining its concept of
the future in cities, it quotes a blog which discusses whether, for example, the most expensive buildings located on the Parisian Île de la Cité
should really be occupied by ministries if they hardly make a positive
contribution to urban development.
Lampugnani points to the fact that many people have now rediscovered
the virtues of historic city centers, even if they mostly cannot afford to
live in the old city. “Downtown areas are frequently ‘museumized’ or the
super-rich have bought apartments there that they only live in every now
and again.” This is similar to what is happening in financial districts and
it is virtually leading to the development of ghost towns, with no real
inhabitants.
The municipal authorities in Zurich have already recognized this problem
and are now renting out some downtown apartments – below ticket price – just to preserve diversity. According to Lampugnani, this is “a nice
start, but certainly not enough.”
the Far East isn’t as dramatic as some would have you believe.” Lampugnani points to Europe’s assets: know-how, skilled manual workers, the
arts – but especially its historic cities.
It’s in these cities, with their slower rate of demographic change, that
there is an opportunity to keep going with existing buildings. As the Canadian architect Carl Elefante succinctly put it: “The greenest building
is the one that is already built.” Every new building, no matter how sustainable it is, still leaves a footprint on its environment during construction. Lampugnani is also skeptical and believes that the plethora of green
building certificates now in existence are a “fad, brought upon us by the
economy.”
Overall, Lampugnani laments how urban planning is now mainly “too
short-winded” and for the most part focuses on generating returns. A
number of factors point to this phenomenon, one being the dissecting
of cities by highways in the 1960s. This has already resulted in the wrecking of whole districts. Another is the excess of office space in many
European cities.
According to the university professor, it is just as shortsighted to focus exclusively on sustainability through building insulation, as some cities are
currently doing. “Stability, cultural heritage and quality of life have to be
an intrinsic part of a sustainability concept. Anything else is short-lived.”
v
On an international level, demographic pressures are making it necessary to develop completely new urban concepts. As early as the 1990s, the
American architect Eugene Tsui designed a skyscraper over 3,000 meters high called Ultima Towers. Its aim was to house more than a million
people, although after 9/11 (if not before), people had been rethinking
high buildings, especially in the United States. Or maybe people’s enthusiasm for these futuristic skyline districts had already begun waning.
An example of a city that does seem to be working is Tokyo, although
according to Lampugnani, people there are generally more tolerant when
it comes to living together in close quarters: “People there make compromises in terms of privacy to allow for other people’s privacy.” In Europe, too, everyone has to work out for themselves whether the constant
yearning for more space really equates to more happiness. “Given the
economic situation we’ve gotten ourselves into, we can’t afford urbanization costs in the long term – just one example: travel.”
But he disputes claims that Europe is now old and outdated, with no real
role to play any more: “Of course Europe overall has lost out in terms of
economic and political clout, but the competition between Europe and
Barbara Ottawa
k BARBARA OTTAWA
Barbara Ottawa is a freelance journalist. She has been writing for
Investment & Pensions Europe, an industry magazine, for six years.
She has also contributed to a sister publication, IP Real Estate and
Institutional Investment, focusing on topics related to institutional investments. Additionally, she writes for a variety of other media outlets
including the Austrian daily financial paper Wirtschaftsblatt and Wiener
Zeitung. She also works as a translator from her home in Vienna.
12
13
Very European: Greetings
from PATRIZIAns on their travels
Während die PATRIZIA noch mit großen Schritten auf dem Weg nach Europa ist, sind ihre
Mitarbeiter schon längst dort angekommen: Ob Österreich, Schweden oder Frankreich – es
gibt kaum ein europäisches Land, das nicht im Team der PATRIZIA repräsentiert ist. Very
europäisch und very polyglott daher auch die Grüße, die uns von unterwegs erreicht haben.
Marcus Müller: Geboren in Salzburg und aufgewachsen
in Wien, lebt seit drei Jahren in München.
James Muir: Geboren und aufgewachsen in
Schottland. Lebt heute in London.
Maria Lagouvardou-Oral: Born in Augsburg and
grew up bilingually (German/Greek).
k
More on page 24
14
15
Under the Type B scenario, there could be a new stable Deutschmark
or a more stable euro on a smaller scale, under a new kind of “healthy”
monetary union – probably the more desirable outcome that would allow
Europe to prosper in the long term. This would be based on the assumption that a sensible and constructive consensus could be reached with
countries excluded from the arrangement – a job that would be mainly
handed to politicians.
Without wanting to expand on any other possibilities, which would more
or less be spectacular variations on either of the above scenarios in a
parallel universe, there would be a number of recommendations for investors, most of which should be advantageous. Type A scenarios would
entail negative value changes in investment markets in the short to medium term. Type B scenarios would be based on a more positive outlook.
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to be a rise in emergency selling as a result of failed financing. At face
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y
e
is
n
T
e
r
h
the
d. This
nce s
southe
te
la
in
a
ia
Under
b
c
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e
ll
e
r
ment
pecia
ositiv
ntly app
employ
tively p
kets, es
r
r
la
a
e
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r
significa
w
m
t
a
lo
r
and
lt in
. Expo
till have
ermany
uld resu
G
o
ssroots
a
in
w
r
would s
g
is
ts
s
e
y, th
mers
g co
ct at th
Indirectl rising financin
eir custo es
.
le
th
still inta
b
d
m
n
u
fi
ld
ric
and
ould cr
r ty wou
rental p
r land,
rope, w
g prope
per ties,
mand fo
in
o
e
s
r
es in
d
a
p
ic
s
r
le
s
ty
p
per ty
e emp
r
o
r
levels, le Europe. People
o
p
m
in
e
a dip
neously
ould b
t of
simulta
ould be
there w
the res
d
w
t,
n
e
n
a
r
e
e
r
p
th
ro
g on
r t term,
would d
defaultin
l rates
the sho
ta
In
n
.
e
p
r
.
o
e
s
r
ris
,a
would d
markets
ts would
stment
ing cos
e
c
v
n
a
in
n
e
fi
th
and
ent risk
investm
k
16
17
forced
lending
or spec
get gain
ial taxe
s, or lo
s) in an
sses, e
obvious
attemp
v
e
n betwe
tempta
t to com
en com
tion wo
pensate
inflation
panies.
u
ld
be to lo
for bud
this enc
A secon
wer inte
ourages
borrowe
d, more
rest rate
investo
d capit
or less
s, since
rs to pu
al, eith
often o
rchase
even wit
er for p
verlook
expens
hout
rivate u
ed (or s
ive prop
curs tan
s
e
w
o
e
r
p
t
e
a
gible co
r
u
s
ti
n
e
a
d
s
n
e
r
on
investm
the car
sts, and
is the c
ent. Wh
pet) is th
at any g
ase for
a
a
t
iv
t
the who
is
en time
ser vicin
This ma
le term
these h
g capita
kes gro
of a loa
ave to b
l inwth a n
the hau
n
e
,
even du
covered
ecessit
nting p
ring foll
. This
y. The
rospect
ow -on fi
fluctuati
possibil
of stag
nancing
on risk
it
y
fl
o
a
f
ti
d
on – as
.
also ha
eflation
set up p
ve to b
well as
– or ev
roperly
e thoug
en
general
and sus
scenario
h
t
interest
through
tainable
s can b
r
carefull
financin
e avoid
y. If thin ate
g is sec
ed.
gs are
ured, so
me of th
e horro
How c
r
an inv
e
s to r s
Ever yth
ing revo
b est p
lves aro
r e pa r
a financ
und fun
e th e m
ial crisis
ding – n
here. S
s e lv es
able to
o
t
ju
st beca
ecuring
sur vive
?
use we’r
“sustain
a temp
whethe
e
a
ta
b
orar y lo
lking ab
le” fund
r payme
ss of e
out
ing also
nts are
dings s
arnings
means
deferre
imply s
from re
b
d
e
in
v
ta
o
g
lu
n
ntal ag
d empty
ntarily,
hard tim
reemen
tenants
. Owne
es if the
ts
r
g
s
,
o
c
a
ost of s
bankrup
comes
re more
if intere
er vicing
t or buil
likely to
st rates
capital
s
regulati
truggle
c
is
h
ange, b
high (or
ons, or
through
ut also
if there
fi
x
e
have no
d
). The r
if there
are cov
w realiz
isk here
is a thir
enants
ed that
d-par ty
the cou
a
ff
e
c
c
ti
r
oss-bor
change
ng loan
ntr y wh
der fina
in
agreem
ere the
ncing d
ents. Pe
proper ty
eals on
ople
stands,
ly
make s
other wis
ense in
e they
are tan
tamoun
t
ve
imply ha
rs will s
to
e
s
e
th
v
r
in
fo
ame
, many
ing the s
rtheless
c
y,
e
n
v
rl
a
e
a
n
il
N
fi
.
their
ll. Sim
culation
bts or se
turing of
e
c
a
d
u
ncy spe
ia
e
tr
le
v
s
rr
u
d
u
e
d
e
c
to
rais
sche
ep th
g is to be
pay to re
but to ke
g
y
in
n
e
c
in
o
n
th
ti
th
a
e
p
n
s
o
s
fi
m
so
no
ncy
, unle
ts. This is
ich curre
le future
h
is
b
x
w
a
e
e
in
r
e
e
s
d
g
e
fore
rly.
o lon
e agre
ed prope
rrency n
have to b
address
ction cu
t
a
s
o
it would
n
n
a
ly
tr
b
ba
ank if a
have pro
foreign b
duce pro
ontracts
c
g
in
c
n
y and re
a
it
n
il
fi
b
t
a
s
li
th
o
f
m
g in e
rm o
r thinkin
hidden fo
to
s
a
e
o
v
ls
in
a
r an
cklogs to
s are
ance ba
backlog
advice fo
n
e
f
te
c
o
e
n
in
a
e
a
n
c
m
ity in th
eep
Mainte
ood pie
ct liquid
ce and k
te
n
. One g
a
e
ro
v
p
lu
d
a
a
v
lp
e
per ty
n well in
is can h
is to pla
good. Th
re
a
s
ld
long term
ie
ny
sis.
um whe
es of cri
a minim
rm in tim
te
m
iu
d
me
shor t to
Owners of the kin
ds of commercia
l proper ty portfoli
pendable financin
os that rely on de
g could use freed
up funds to seek
ties. Some investo
buying opportunirs have already be
en quietly getting
cessfully, for som
on with this, suce time. With the
right concepts, en
the determinatio
ough liquidity, an
n to keep going, bu
d
t also with the rig
can also make pr
ht timing, investo
ofits from purcha
rs
ses in the long te
rm.
It is generally unde
rstood how impo
rtant it is to analy
ly. But this does
ze tenants proper
not just involve th
inking about the
tenant market
in general, or the
probability of tena
nts defaulting, or
There is more to
expected growth
be gained from re
.
gularly meeting te
ants rather than sim
nants and occupply quer ying data
bases. Tenants ar
mobile, especially
e becoming more
in rental markets
. So it generally m
and update agre
akes sense to sig
ements on real es
n
tate, even with ex
course tenants do
isting tenants. Of
not want to be
tied to agreemen
be kept happy, an
ts, but they can
d in some cases
even delighted. Th
sense of loyalty th
is can result in a
at in the majority
of cases will even
Some developer
survive a crisis.
s or commercial
pr
op
er ty portfolio ow
fully set up tenant
ners successs’ associations. If
owners can keep
long-term point an
highlighting the
d purpose of such
arrangements, m
will lend them du
ost occupants
e respect.
It’s worth adding a point, even
if it might be going off on a tang
ent. It was
surely a huge mistake to focus
on the “big problem” (as far as
the general
public was concerned) and thus
ignore continual changes in lots
of other
relevant areas. The commercial
real estate market is undergo
ing huge
change at the moment. At this
year’s summer conference held
by the
Research Center for Real Estate
Business Administration (Betrieb
liche Immobilienwirtschaft, based at Tec
hnische Universität Darmstadt)
, a number of corporate real estate man
agers declared that the amount
of land
used by their companies in Euro
pe has shrunk by up to 60 perc
ent – a
direct result of the introductio
n of new workplace concepts.
This is a gargantuan number, but it has dire
ct and major implications on inve
stors.
k Dr .
v
Bj ö r n -
Martin
K u r z ro
ck
Dr. Björn-Martin Kurzrock
Dr. Björn
-Martin
busines
Kurzroc
sa
k
helps ru t the Universit has been a jun
io
n the Fa
y
cility M of Kaiserslaute r professor of
on the m
ana
rea
rn
e
compan chanics of rea gement degre since 2008. H l estate
le
e
ie
e
tät and s with propert state markets and is conducti currently
yp
sp
an
n
2006 a eaks at a varie ortfolios. He a d managing re g research
nd
lso lectu
ty
al
res at EBS estate
investm 2008, Dr. Kurz of convention
s and p
ent pro
rock wo
Univers
u
p
b
rked at
erty ban
at IPD th
the Wie lic events. Betw ik
a
sbaden
een
studyin t he embarked IPD, where he
-b
g at EBS
as
w
o
and Ge n his career a as head of res ed
s a rese
orgia Sta
earch. It
a
te Unive
rch ass
w
ociate a as
rsity.
fter
18
Europe’s
special sorcerer
What of Europe? According to the Middle
East expert and self-proclaimed “world
annotator,” Peter Scholl-Latour, the
situation in Europe is reminiscent of the
ballad of the sorcerer’s apprentice. In an
interview with estatements magazine,
the Franco-German journalist, was invited to turn global perspectives in a European direction for once.
19
20
21
Off they run, till w et and w etter Hall and steps immersed are
lying. What a flood that naught can fetter! L ord and master,
hear me crying! - Ah, he comes excited. Sir, my need is sore.
Spirits that I've cited My commands ignore.”
estatements: Mr. Scholl-Latour, what spontaneously comes to mind
when you hear the word “Europe”?
_ Peter Scholl-Latour: At the moment, mainly the need for Europe to
pull together into a bigger geographical entity than the nation states
have composed until now. Especially given the fact that we’re currently
in a time in which regions are merging. Compared to notable world
powers like the United States, China or Russia, Europe is a rugged object marked by divisions. The French author Paul Ambroise Valéry has
already pointed out that if you look at Europe purely from a geographical
point of view, it’d be like a promontory in Asia. In essence, the long-term
issue is survival. Can we come together or not.
estatements: One of your most recent books, which was published
in October, is called “Die Welt aus den Fugen” – the world in disarray or out of kilter. To what extent is Europe off the rails?
_ Scholl-Latour: It really cannot be ruled out that European unification
falls apart. It would be a disaster for everyone concerned. It could be
because of internal rivalry or difficulties, but also because of sabotage
from outside. The merging of our continent isn’t popular with the English and the Americans. But on the other hand, there’s almost a sense
of compulsion, as we’re witnessing at the moment with Greece. Lots of
people want the Greeks out of the euro zone but the European Union
can no longer extricate itself from the affiliations. Even if, temporarily,
there are financial difficulties and drawbacks, in the long-term the EU is
actually the only sensible solution. Also, I hardly know a single European
statesman, if indeed there actually are any European statesmen any
more, who would openly plead for Europe to be broken up.
estatements: Over the summer, some German politicians were
pushing for Greece to leave the euro zone as quickly as possible.
What do you think about this?
_ Scholl-Latour: Germany should stop its crowing, as it also benefits
from Europe. There’s an insane yet widely held belief that we’ve done
nothing but suffer under Europe and have done nothing but pay for it,
to which I’d counter that we’ve profited hugely from Europe. If the European Union were to dissolve and Germany went back again to the
Deutschmark, it would be hard as nails and shoot up. The result would
be a colossal dip in our exports as most German exports go to European
countries. The moment quota fixing or export barriers are in place, it
would be detrimental for us. It’s also worth considering that, in terms of
the overall budget, if that’s what to call it, Greece only accounts for two
percent of the euro zone.
estatements: Imagine Europe is history. How does that make you
feel, thinking about the “old” Europe with turnpikes and currency
exchanges?
_ Scholl-Latour: It’s difficult to imagine that now. The situation in Europe could be compared with the story of the sorcerer’s apprentice: we’ve
set something in motion that we can’t get out of anymore. Now what’s
needed is a grand sorcerer to iron things out. As Helmut Schmidt already pointed out, the euro is not the actual problem. It may have dipped
a bit versus the dollar, but that’s only had positive effects. I remember
when the euro was worth $1.50. Everybody was moaning that it was
much too strong and a menace to our exports. If the euro dipped down
to $1.20, it wouldn’t be the end of the world. I think if you speak to sensible financial experts you’ll see the picture’s not at all as gloomy as the
press would have you believe. All they do is sensationalize.
estatements: Why do you say that?
_ Scholl-Latour: It’s just, in a general sense, we’re subject to targeted
disinformation – whether it’s Syria, Libya or Iraq, or if we take China
as an example. The country’s undergoing prodigious change and the
Europeans talk it down, almost gloatingly. We’ve got to acknowledge
the other issue in Europe which our politicians and media people are not
picking up on at all: Our kind of democracy and parliamentarianism isn’t
transferable to other societies in the world. We can’t go ruling China
and its 1.4 million people with a kind of parliamentarianism that we’re
struggling with in Germany.
As we’re seeing in the Arab world, these societies have to painstakingly
work out a system which matches their nature, their predispositions,
and their possibilities. These are things that people are not taking notice of. We keep assuming that the European or western and American
model is global and universal. And I’m not just talking about the way of
life, it’s about economic and political attitudes. The hegemony of the
“white man” is history.
already gone this way. We shouldn’t keep cowering or thinking that the
others are making a better job of it. Our alliance and our collaboration
within Europe are indispensable, precisely because we’re exceptionally
weak militarily. It’s this that puts us in a state of dependency, which in
the long term is neither good for us nor for the Americans.
estatements: You just mentioned the grand sorcerer that must save
Europe…
_ Scholl-Latour: Europe needs a grand statesman, a kind of Bismarck
on a European scale. But there isn’t one, whichever direction we look
in. Finding one is probably the biggest problem. On the other hand, the
nation states and people have not yet sufficiently dismantled their own
national consciousnesses, and they also won’t do it in the future, in order
to grant some other person absolute supremacy. That wouldn’t work.
Looking at the unrest in the neighborhood, we’ll be faced with both political and strategic decisions, and we’ll have to do something to prune the
circle of decision-makers. With so many people adding their two cents to
the discussion these days, it will be impossible to continually make quick
decisions. From one day to the next, we could find ourselves in a completely new situation, as the Arab Spring showed. Then it’ll be key to be
in a position to make decisions and not wait until the Federal Supreme
Court in Karlsruhe decides on something.
v
estatements: Imagine you were granted a wish – what would you
wish for Europe?
_ Scholl-Latour: I’d wish that the people in Europe become conscious
again of the need for European agreement. There would be no more
internal borders, we’d all use the same currency and there would be
no enmity. The idea of a war inside Europe, like a small Balkan conflict,
would no longer be conceivable. I’d especially wish that the Europeans
gain a feeling for their own potential power again, which they do actually
possess. Europe is a very, very strong assembly. Ultimately, America has
k PETER SCHOLL-LATOUR
estatements: Thank you for your time.
Interview conducted by Monique Berchtenbreiter.
Peter Scholl-Latour is a Franco-German journalist, author and
commentator on public affairs, considered by many to be one of the
leading Middle East experts our of time. He has worked as an Africa
correspondent for the German public television broadcaster ARD and
he was the founder of the ARD studio in Paris as well as director of
television and programming for WRD. He was also editor-in-chief and
publisher at Stern magazine. During his career as an author, SchollLatour has written over 30 books. His latest works appeared in October 2011 (Arabiens Stunde der Wahrheit – Arabia’s Hour of Truth)
and October 2012 (Die Welt aus den Fugen – A World in Disarray).
22
23
Own Your Own Home!
Germany ranks next to last in Europe in terms of property ownership. Switzerland is the
only other country with more people renting residential property. But less ownership
doesn’t have to be a bad sign. In fact, it creates more mobility in the labor market as well
as social solidarity. It also stabilizes private consumption.
T
he dream of living in your own four walls is shared all over the
world. But this dream comes to fruition more often in some
countries than in others. International comparison reveals that
Germans are relatively hesitant to purchase residential property. With an
ownership rate of roughly 45 percent, Germany ranks next to last among
European nations. Only Switzerland’s figure is lower, at 35 percent. The
European average lies at 60 percent. The frontrunner in terms of ownership is Spain, where 88 percent of residencies are now owned. Levels
are also very high in Norway, Portugal and Italy, each of which has an
ownership rate of 77 percent.
What drives these differences? The decision to invest in your own four
walls is primarily a personal one that depends upon an individual’s private circumstances. For families with children, the security of a home is
extremely important. For young, single adults who want or need flexibility
for their professional endeavors, on the other hand, renting is the logical
option. Of course, individual income plays an important role in the decision to buy or rent.
Apart from individual motives, living situations are also influenced by cultural, legal and economic factors which differ from country to country.
While real estate ownership in Germany is strongly dependent upon
available income of private households, in southern Europe it is common for people with low incomes to acquire residential property or build
a house. In these cases, friends and family members often chip in to
keep costs as low as possible. Very frequently, properties are passed
down from generation to generation. This process plays an important
role in Italy, for example, where, more often than not, young families
inherit houses from their parents. One reason for this is the rapid rise in
purchasing and rental prices which makes it difficult for young people to
pay for their own living space.
In general, a high residential property rate indicates that the rental property market in that country is not functioning properly. As shown in an
analysis conducted by the University of Madrid, this can be attributed
mostly to legal frameworks. According to the study, the residential property market across Europe is strictly regulated. As a response to the
housing crisis following the two World Wars, European countries began
regulating the market in the first half of the 20th century, mainly by implementing laws on rental conditions, peak rentals and ceilings on rent
increases. As a result of the high inflation during the 1973 Oil Crisis,
several countries linked increases in rent to inflation rates. These measures ultimately led to a decline in available rental properties and, as a
consequence, a reduction in the number of people renting. That’s why
the percentage of rentals in Spain went from 30 percent in 1970 to
21 percent in 1981, finally falling to approximately 12 percent in 2009.
Contrary to Spain and the other European countries, the rental markets
in Germany and Switzerland were much less regulated from the start.
Regulation is thus a fundamental cause of the varying residential property ownership rates in Europe.
The level of residential property ownership depends on how purchasing
and rental prices develop. If purchasing prices shoot up compared to
rental prices, as is the case in several German cities, there is more of an
incentive to rent.
What can be concluded about the relatively low property ownership rate
in Germany? Many argue that the rate should be increased through political means due to the potential economic benefits. Behind this argument is the notion that more ownership stimulates the economy, on the
one hand through investments in construction and, on the other, by way
of private consumption. In the US, for example, owners could consume
more by using a part of their property appreciation during the real estate
boom to refinance their property or raise more credit. When the housing
bubble in the US burst, it revealed the dark side of this strategy and its
potential to substantially weaken economic growth. The abrupt slump in
house prices forced private households to tighten their belts, straining
the domestic economy. By contrast, a well-functioning rental market
would have stabilized demand, especially among lower income groups.
An additional argument for stimulating property ownership is that owners are more active in the community than renters. But here, important
differences between the US and Germany regarding the length of rental
agreements were overlooked. While Americans, for the most part, only
temporarily rent properties, renters in Germany seek long-term rental
agreements. Therefore, it’s not ownership itself but the amount of time
one intends to spend at a certain property that determines how active
people are in the community. As such, a functioning rental market that
provides an adequate selection of rentals in the long term makes an
important contribution to social stability.
Moreover, the low ownership rate is advantageous for the export status of
the German economy. According to an OECD study – which took different
characteristics into account like age, income, family status and employment situation – owners are much less mobile than renters. The high level
of renters in Germany thus boosts mobility within the labor market. Ultimately, this contributes to the overall competitive advantage of Germany.
v
Dr. Marcus Cieleback
k
k DR. MARCUS CIELEBACK
Dr. Marcus Cieleback has led the research unit at PATRIZIA
Immobilien AG since 2008. His key areas include the analysis of real
estate markets with respect to risk and return as a basis for defining
country- and sector-specific strategies and developing econometric
models for market forecasting. Dr. Cieleback regularly gives speeches
at international conferences and a number of his expert analyses
have been published in international specialist newspapers.
24
25
Amelia Malatesta: Geboren
und aufgewachsen in Lublin/
Polen, lebt heute Augsburg.
Nathalie Winkelmann: Geb
oren in
Überlingen am Bodensee
wuchs
zweisprachig deutsch/fra
nzösisch
auf. Lebt heute in Augsbu
rg.
Lucie Hladikova: Geboren und aufgewachsen
in Most/Tschechien, wohnt seit 1988 in Berlin.
k
More on page 34
26
27
Mixing the right ingredients
So many Germans accuse us Americans of being superficial. I find this sweeping judgment
somewhat bewildering. But I’m an American, which means I’m much too polite to moan
about it.
Y
ou have to keep reminding yourself that the
United States is a nation made up of immigrants. Almost no-one actually comes from
America. At some point, everyone went to America
– whether they wanted to or not. Our superficiality
is a survival strategy. When so many people from so
many countries and so many cultures and so many
differing historical backgrounds come together, it’s
simply simpler to be nice to each other. We Americans are born optimists - Yes we can! Even if we
can’t always.
Ask an American “How’s it going?” and he’ll always
answer “Fine!” Ask a German a similar question and
he’ll shake his head, shrug his shoulders, take a deep
breath and utter something along the lines of “Eh …
it’s going.” That’s just one example of the small, but
meaningful differences in our mentalities.
The best way to spot the differences between the
Germans and the Americans actually is at the superficial level, on the surface, i.e. through our physical
appearances. Are we Americans born with some
kind of special DNA that tells us, “You’re gonna have
a giant ass!”?
k
An ideal world as presented by Bill Cosby and
friends. Perhaps a little too loud and obnoxious…
and too plump. 1988 saw the Connors from Landford, Illinois win over the hearts of mainstream
America. At the head of the pack? Leading lady
Roseanne took us through the eponymous series
depicting the turbulent life of this working class
family. Marked by sharp humor and plenty of irony,
it touches upon many an American cliché.
The number of overweight Americans has risen sharply since 1960 – by more than 40%. Today, over 75%
of all Americans are overweight. What’s doing this
to us? Something in our water? Or the fact that our
water’s actually called Coca-Cola? My sister’s always
stocked up with several 5-liter big gulp bottles in her
fridge. In American movie theaters, there’s now a
cup size called tsunami – 2 liters of Coke for a single
person. I belong to the first generation of Americans
that grew up with McDonald’s – and I mean GREW
up! We’ve been super-sized and XXL-ed, we’ve guzzled down these huge portions that would be enough
to feed a hard-working farming family. But instead of
burning up all our calories out in the fields gathering
vegetables, we’re vegetating in front of the screen
playing Farmville. Our collective fat ass won’t even
fit into normal seats anymore. The seats on the PATH
train that shuttles commuters between New York
and New Jersey had to be widened for the first time
in 2012, from 44 centimeters up to 49.5. Why? Because most butts in New Jersey are much wider than
44 centimeters.
This isn’t just putting a strain on the pants of travelers
but also on the bridge of sighs between commuters
in New Jersey and chubby people worldwide. Years of
overeating refined carbohydrates (white flour, white
sugar) combined with toxic stress (disease, divorce,
departure, joblessness – or what I call “everyday
life”) culminates in at least a muffin top – belly fat
brimming over the beltline like a life ring. Even worse,
it can end in diabetes, a heart attack or cancer. Refined carbohydrates are relatively new to our civilization. Chicken McNuggets, nachos and Dunkin’ Donuts
might taste yummy, but in a modern world they don’t
exactly enhance our chances of survival.
I’ve gotta admit it, I’m a carb junkie. I’m in awe of
anything made out of a bit of flour, some yeast and
a little bit of loving. I remember my first pizza just
as clearly as my first kiss. My dad was a barkeeper
at Maple Alleys Cocktail Lounge. It was the bar next
to the bowling alley. The pizza and beer sold like
hotcakes. He often came home really late, and a
bit drunk, but he always brought us kids a leftover
pizza as a kind of forbidden culinary apology. This
sinful breakfast was my introduction to a world of
temptation full of carbohydrates, an entangling place
where desire, guilt and delicacy collide, a place in
which I found consolation and peace. When I was
four I discovered spaghetti. At eight I moved on to
potato chips.
My mom used to work in a supermarket, and we always got home before she did. My brothers helped
me fill the gap between school’s-out and supper
with fluffernutters – sandwiches made with Wonder
Bread, this soft and fluffy, synthetic-tasting white
bread made for toasting. It’s so airy and empty, you
can squeeze the whole loaf together with one hand.
We spread peanut butter and marshmallow creme on
it. Carbs and sugar – my first experience of intoxication!
And it just kept on going. Off to new shores! In
New York, I discovered bagels and knishes – Jewish
dumplings, baked or deep-fried. When I was living in
the East Village, I only ever ate at Leshko’s Coffee
Shop, a Ukrainian deli on Avenue A. My regular diet
was made up of pierogi, blintz, blini – and the occasional plate of borscht. During my first European
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tour I added crumpets in London and brioche in Toulon until I finally made it to Germany, the ultimate
haven for carb freaks: spätzle, maultaschen, knödel,
pretzels and over 300 bread varieties!
I sometimes wonder if my true affinity with Germans
is a result of our common craving for baked goods.
Have you ever seen a German not eat bread? Send
a German off to a breathtakingly beautiful location
– pick anywhere on the whole planet, the Taj Mahal,
Timbuktu, Tahiti – and he’ll say, “But the bread’s no
good here. You won’t find any decent bread here ... It’s
great here, but what I really have a hankering for is a
good loaf of bread.” You gotta love that about the Germans – give ’em a piece of pumpernickel and they’re
happy. It’s so down to earth, so bodenständig!
And that’s where we overlap, the Germans and me –
at the place where carbohydrates intersect with true
happiness. When I first went into a bakery in Stuttgart, I decided on the spot to uproot and move to
Swabia just to breath in the morning air, steeped in
freshly baked bread rolls. I’ve often wondered why all
Germans aren’t fat, but I reckon their carbohydrates
are good German carbohydrates. They probably all
come with a universal stamp of approval from those
product testers at Stiftung Warentest, so they always
contain a bit of spelt or even unripe spelt grain. The
Germans are sturdy, active people who grew up with
plenty of fresh air.
Having now spent 22 years in Germany, I’ve finally
unraveled the German recipe for true happiness:
opening the windows to get some fresh air. Fresh air
is the German answer to all problems. Come on, let’s
throw open the windows! Let’s get some fresh air for
5 minutes and it’ll all be fine. Magnificent!
Come, come with me, we’re popping out to grab a
bit of fresh air! Grab fresh air? If that’s not go-getting! It’s anathema to us in America. It certainly was
to me. The first time I heard someone suggest we
“quickly air the room” I was genuinely shocked. A
rush of fresh air – Stoßluft!
And my, you’re the world champions when it comes
to going for a walk! Going for a walk? In your leisure time? Awesome! It’s Sunday afternoon, and the
whole of Germany gets up and goes for a walk. The
weather? Who cares about the weather. Last year I
k GAYLE TUFTS
Gayle Tufts is an American entertainer who lives in Berlin. Heralded as
“Germany's most famous American” by Stern magazine, she works as
an author, singer and performer. Gayle has been captivating audiences
with her fantastic stage presence and performances that span a
variety of genres. In addition to her stage productions, she regularly
appears on television and radio programs. She also writes books and
articles for a variety of magazines and newspapers. Although she has
been a resident of Germany since the early 90s, her insights into the
country provide a refreshing view from the outside in. And they always
incorporate her amazing international (stage) experience.
traveled up to the Baltic coast with my family. I was
wrapped from head to toe in Jack Wolfskin SympaTex, the rain was belting down, and we got on our
bikes to “grab some fresh air.” We actually paid money for this goddamn holiday, let’s get a bit of fresh
air, come on!
After more than 20 years in Germany, I’m also bodenständig, a down to earth person now. I guess it’s
what this country, the home of Birkenstock slippers
and Dr. Hauschka skin care, does to you. I enjoy getting up early and getting some exercise. I get out of
the house and do some power walking. In the old
days, it was about going for a walk if you needed
to pee. But now, the proper German term is power
walking. The Sunday before last I got to the end of
the street, there wasn’t a car in sight and there were
six grown people standing as stiff as a rod staring
intensely at the little red traffic light – a rote Ampel. I
just don’t get it. In New York you cross! You cross the
fucking street! I said to my husband, “What’s going
on with this Rote Ampel thing?” and he said, being
the good German he is, “You have to be a gutes Vorbild for the Schulkinder.” – you have to set a good
example for school children.
I just don’t get it. A week later, it’s 6 in the morning,
the same rote Ampel, again not a car in sight, just a
really cute 6-year-old boy next to me. And I’m thinking, I have to be a gutes Vorbild, set a good example. So I grab him by the hand, run across the street
as fast as I can and say: “Don’t waste your time, life’s
too short!”
It’s all about mixing the right ingredients. One in
eight marriages entered into in Germany in 2010 was
a mixed marriage – not mixed in terms of gender, but
of mixed nationality. Okay, things didn’t work out for
Heidi Klum and Seal, but otherwise this seems to be
a pretty good recipe for success. I’m also in a mixed
marriage and have learned a lot from my husband,
who’s from Bremen. American gals just love the
steadfastness and clarity of their German husbands.
They simply ooze this irresistible calm, that immediately says, “Guten Tag, let’s have children and sign up
to start saving for a home loan.” We love that! They’re
also so helpful when we bite off more than we can
chew with our I-can-have-it-all-business-fitness-kidsculture-sexbomb-housewife-get-up-and-go-ness.
They stick with us and console us with their straightforward step-by-step-ness. And that’s the other overlap – where optimism intersects with down-to-earthness. That’s where I’m at home.
v
Gayle Tufts
29
Typically German – starting with the name of this picture-book family:
meet the Beimers. Featured on the television soap series “Lindenstraße,” Helga and Hans lived happily with their children Marion, Klausi, and
Benny. Sounds very middle-class, if not a bit bourgeois. But Germany’s
first soap has been entertaining the masses since 1985 – providing
many an insight into everyday problems and twists of fate. The Beimers
have attracted viewers every Sunday for years on end, truly becoming
a “cult classic.”
30
Not just stable, solid:
welcome to northern Europe
31
The northern European states have done well to survive the financial
crisis in the euro zone. This applies, of course, to their real estate
markets as well, which are regarded as some of the most attractive
in all of Europe. As a result, these markets represent an interesting
alternative for investors looking to diversify their investments.
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T
he man has a ponytail and sports an earring. He paid the nanny under the table for years and avoided paying his radio and
television license fees: Anders Borg does not seem to fit the
bill when we imagine the finance minister of an industrialized nation.
Yet this 45-year-old politician has successfully held the office for more
than six years now, and there isn’t a finance minister in the entire European Union who wouldn’t gladly switch places with him. That’s because
Sweden’s economy and state finances have proven remarkably resilient
over the past few years – so resilient that, at times, Borg can even chalk
up a budget surplus.
But in his 2012 Christmas address, this finance minister faced the
nation with some relatively disheartening news: he conceded that the
euro crisis was taking a bit of a toll on the country, since nearly 70%
of Swedish exports go to Europe and 40% are shipped to EU member
states. The figures led the government to reduce the country’s 2012
GDP growth forecast from 1.6 to 0.9%. What’s more, for 2013, they
can only anticipate economic growth of 1.1%, not the 2.7% of earlier
projections. “The international uncertainty has led to increased saving
among households and that means companies are scaling back their
investments,” declared Borg to explain the drop in numbers. The national deficit would, in turn, lie at 0.4% by the end of the year and possibly
rise to 1.3% in 2013. At the same time, he announced large-scale investments aimed at fuelling the economy. Shortly before, the Swedish
central bank took action by lowering the prime rate by 0.25%, down to a
total of 1% – the fourth rate reduction within twelve months.
Similar situation to Germany
And thus, the largest national economy in northern Europe finds itself
in a similar situation as Germany: the economy is still growing, but because of the euro crisis, growth is not as strong as it used to be. Unemployment is relatively low, peace among the social classes is a given,
and the country has relatively solid state finances – the national debt
lies only at nearly 40% of GDP. But more importantly, Sweden can rely
on a stable banking sector – one which has hardly been affected by the
international financial and economic turmoil. Any finance minister from
the more crisis-ridden southern European countries would probably tell
Anders Borg he only has the right kind of problems.
His “problems” are shared by all of the northern European states. They,
too, have relatively low unemployment rates and low national debt. Additionally, they will probably be able to stave off recession in 2013. In that
vein, Denmark expects an upswing of 1.2% in 2013, after a slight GDP drop
in 2012. Norway, a country with oil reserves, even forecasts a growth rate
of 3.0%. And the central bank of Finland, the only country among the four
that uses the euro, expects a slight increase of 0.4% in 2013.
33
The fact that many investors see the Scandinavian states and Germany
as a safe port of refuge has led, for one thing, to low interest rates in
these countries. That’s how Denmark, a country with a triple A rating,
came to be the first country in 2012 to achieve a negative return when
bonds were issued. And this investment interest is also reflected in the
exchange rates. That is, the Swedish and Norwegian Krona gained considerably versus the euro in 2012.
High price hikes
This stable development is also evidenced by the Scandinavian real
estate markets. With the exception of Denmark, they have developed
very well over the past few years. As a result, the IWF warned against
a possible real estate bubble in Sweden in 2011. At the time, even
Anders Borg talked about “serious risks” on the real estate market in
comparison to the previous decade – which saw year-on-year increases
in the upper single digit range. This inspired the government to tighten
the credit laws and even Sweden’s central bank – the Sveriges Riksbank – tried to counteract the risk. In the meantime, the situation has
stabilized, and, several months ago, the Riksbank was able to announce
sinking real estate investments in the second quarter of 2012. Dramatically increasing real estate prices aren’t really expected again by the
central bankers until 2014 and 2015.
for this type of investment include the areas around Vejle, Kolding and
Fredericia in Denmark, and Jönköbing in Sweden. “As a euro investor
in Sweden, it’s important to keep a close eye on the currency and to
hedge against exchange rate risks,” she recommends. The returns that
can be achieved through Nordic investments are definitely nothing to
shake a stick at. “Solid annual yields in the mid single digit range are
still very much conceivable, and, with the right willingness on behalf of
the investor to take some risk, even higher returns are possible,” believes Marcus Cieleback.
The decision-makers at PATRIZIA speak from experience. Since 2005,
the company has invested a total of €400 million in these four Nordic
countries, spread across three funds. The money was invested in both
residential and commercial property. Conversely, Nordic investors are
turning their sights on the German market. This allowed PATRIZIA to raise significant equity capital there in the last few years, which was then
channeled into the German residential and commercial property market. The investment volume totaled nearly €500 million – so it seems
the Nordic countries and Germany are similar in more ways than one.
v
Bernhard Wild
The situation looks a bit different in Norway. There, the national realtor association has advocated an interest rate increase in the last few
months, in order to avoid a real estate bubble. The country’s census
bureau recently declared that the expectation of further lower interest
rates and higher incomes will no doubt lead to a sharp rise in real estate
prices, though less than in recent years.
“The Swedish real estate market will see slight adjustments, but this will
not necessarily cause prices to tumble. Rather, it will likely result in lateral movements. And, looking at Norway, active construction projects
are sharply on the rise. As a result, the trend toward price increases
will be held back somewhat,” says Markus Cieleback, chief economist
at PATRIZIA Immobilien AG, explaining the situation in both countries.
He certainly doesn’t foresee a real estate market bubble in these countries.
“The most attractive residential
property market in Europe”
In Denmark, on the other hand, real estate prices currently lie nearly 20% under their peak prices in 2007. And that’s precisely what’s
making the Danish market so attractive. According to Cieleback: “The
residential property markets in Denmark and Finland are some of the
most attractive in all of Europe.”
Which begs the question: Where exactly could investments in the four
Nordic states be most profitable? “Of course, the four capital cities
are very interesting on a general level. But for one thing, everyone invests there, and for another, it’s always more worthwhile to look off the
beaten path for alternatives,” says Rikke Lykke, managing director of
PATRIZIA Nordics A/S, which was founded in September 2012. As an
example, the residential property market in Denmark’s second largest
city, Aarhus, is quite attractive. But even the Swedish university town of
Linköping proves to be a good alternative when looking for investments
in residential property.
What about commercial property? “As a euro investor, I’d focus on Denmark and Finland,” says Lykke. But even the Swedish market has its attractions when it comes to office buildings. Regions she would consider
k BERNHARD WILD
Bernhard Wild has a business degree and works as an economics
journalist. Until 2000, he was one of the business editors at the
Süddeutschen Zeitung. Since then, he has lived and worked in Munich
as a freelance journalist, where his writing now focuses on the core
areas of money and real estate.
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35
Rikke Lykke: Born and raised in Svendborg on the
Danish island of Funen, she now lives in Copenhagen.
in Friedberg, Bavaria; grew up
Athina Cecchin-Resch: Born
lives in Augsburg, Germany.
ently
Curr
bilingually (German/Italian).
Henrik Österberg: Born and raised in Kvänum,
Sweden, he now lives in Stockholm.
Cornelia Höhne: Born and raised in Stralsund,
Germany, she has lived in Hamburg for 18 years.
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The diversity of breakfast habits among the peoples of Europe is a dilemma for the EU.
How can people who nourish themselves so differently share the same social aims, or agree on unified cultural, educational and financial policies? The strategy of the new Europe
will depend on whether the European Parliament can define nutritional standards for breakfast – standards that will work throughout the whole of Europe.
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A
ccording to television advertising, we all like
to eat the same things for breakfast. Those
advertising johnnies and johnettes don’t
doubt one bit that there’s no better way to start the
day than with a crispy waffle or mild yogurt. The important thing, they say, is to have something light,
fast and sweet. The hard reality – that there are people who have problems with this general feminization
of the world and maybe eat sausage and country potatoes for breakfast out of protest – is gently glossed
over on television.
Living, breathing people are much more choosey
than television would have them seem. Their tastes
depend on a number of factors like their personality,
family traditions, the number of sunny days in a year.
Breakfast is a very personal thing, a viaduct that leads
people out of the slumber of the night into the sunshine of everyday life. The path can sometimes be hard
to tread, especially if you stayed up too late the night
before, or drank too much with the wrong people.
Human experience has shown that good Protestants
who drink beer and shots tire quickly and hit the sack
early. The next day, they’re the early birds that catch
the worm. To deal with that squirmy wormy creature,
they grant themselves a hearty breakfast. The Germans offer the best selection of breakfast sausages
in Europe, hands down – a gold medal for hearty
breakfasts that can only occasionally be challenged
by the Poles and Czechs. The Russians, too, enjoy
something substantial in the morning, but it has to be
hot, like a thick soup that really flushes the hangover
out of the system. Even more effective is their pick-
le relish, the Russian equivalent of freshly squeezed
orange juice. That’s why pickle jars are never thrown
away in Russia, even long after the pickles have been
eaten.
But we’re digressing. Let’s continue. The Catholics
and the wine drinkers – the Italians, Spaniards, and
French – love to grab a late dinner. In fact, they can
spend half the night sitting around the table. When
the wine is flowing, people become more emotional,
more communicative. When some people drink wine
they feel angry or offended about something, others
become more sentimental or mellow. Others still
become aggressive. But wine rarely seems to make
anyone drowsy. That’s why wine drinkers don’t even
think about food early in the morning; they don’t
even eat breakfast. They just grab a small, strong
coffee and begin thinking about a real meal around
lunchtime. To put things into perspective it’s worth
mentioning at this point that the Spaniards do sometimes deep-fry their waffles for breakfast, although
they look somewhat different from the ones we see
on television, and are anything but healthy.
The English, who have otherwise forfeited their own
cuisine for Indian food, thought up a breakfast of
their own, that totally goes against the grain. They
eat parboiled oats, mixed with maple syrup, brown
sugar, and cold milk. A magnificent, insane invention. But of course, the English have always done
things their own way. They did after all invent parliament, a monarchy which is completely powerless,
capitalism and, of course, oats. Different strokes for
different folks.
The Greeks like to show others how they, like true
Mediterraneans, skip breakfast altogether. When
they sit in front of their little houses in the summer,
they act like they survive purely on Metaxa. But the
moment they enter the kitchen, they lay into anything
they can sink their teeth into and fry up anything they
find in the fridge.
The conventional European opinion of the Bulgarians – that they love to eat vegetables, and they eat
vegetables frequently – is a façade. In reality, they
would much rather eat sausage and bread. The vegetable thing is just a hoax to help them promote
their vegetable ragout, apparently the country’s most
important export.
The Portuguese love soups that look like you poured
an aquarium into a cooking pot. The Austrians are
the only country that still practices the ancient art
of the “egg in a glass” – an egg, perfectly soft and
runny on the inside, but with no shell. There it stands,
from head to toe, all by itself, completely naked in a
glass, under a veil of green chives. No one knows
how they do it, apart from the Austrians, that is.
we can let them keep their secret and still get to
sleep at night.
The diversity of breakfast habits among the peoples
of Europe is a dilemma for the EU. How can people who nourish themselves so differently share the
same social aims, or agree on unified cultural, educational and financial policies? The strategy of the new
Europe will depend on whether the European Parliament can define nutritional standards for breakfast
– standards that will work throughout the whole of
Europe. A tempting European breakfast will replace
breakfasts in Germany, France and Italy. A dish that
brings together the advantages and customs of all of
our countries, while playing down their disadvantages. But not without some muesli or pickle relish.
v
Wladimir Kaminer
During the communist era, the Czechs had the best
croissants in the world. Today, the Latvians still have
the best caraway seed rolls around. The Estonians
love muesli (because they want to be the perfect Europeans and do as they’re shown on television).
What the Swiss eat for breakfast is still a mystery.
A shroud of secrecy still hovers over the country’s
breakfast tables. But Switzerland isn’t in the EU, so
k WLADIMIR KAMINER
Wladimir Kaminer was born in Moscow in 1967. After finishing a
qualification in sound engineering for theater and radio, he went on
to study drama theory at the Moscow Theater Institute. He has been
living in Berlin with his wife and two children since 1990. Kaminer regularly publishes articles for a variety of newspapers and magazines,
and organizes events such as his “Russian disco,” meanwhile a popular international venue. A collection of his writings share this name,
and together with further books he has penned, he is fast becoming
one of Germany’s most popular authors. All of his books are available
as audio books, which he reads out himself.
La Réunion – Europe’s
Exotic Extremity
A potpourri of rain forests, volcanic craters, secluded valleys and karstic crags:
La Réunion, Europe’s extraordinary extremity, deep in the Indian Ocean. An
energy-sapping expedition through the terrain of La Réunion rewards the hiker
with a treasure trove of vivid and enlightening experiences.
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The volcanic caldera called Cirque de Salazie - a paradise for hikers on La Réunion.
O
ur hiking group crouches, perched on rocks overlooking an
800 meter canyon. We pant for air as the clouds, white and
fluffy, race across the sky, swiftly sweeping their way over the
blue-green slopes. A gust of wind. A billowing breeze cooks up a sea of
clouds where, just moments before, we had marveled at a rugged canyon. We’re on the island of La Réunion, a mélange of color. Mood swings
and weather changes to the beat of time. Our booking: “Trekking on a
tropical island” – an adventure destined to take us through three volcanic calderas, the cauldron-like cirques – for the most part through steep
climbs and descents. At its far-flung extremity between Madagascar and
Mauritius, Europe is wild, dramatic and beautiful.
The wind whistles through a forest of bamboo. The drip-dropping of water off moss-covered rocks. Somewhere in the jungle, the squawking
of a bird. A tek tek to the locals, because that’s its call. No boulders
roll onto the pineapple plantations. No lava pours down the hillsides.
France’s tropical départment is relaxed these days. But even without the
onslaught of natural disasters, this former coffee and sugar cane colony
in the Indian Ocean takes your breath away. Its coastlines are humid and
hot, its 2000 meter-high peaks chillingly regal. Its volcanoes a starburst
of black and red. Its rainforest a canvas of chartreuse.
In the Cirque de Mafate, Réunion’s most rampant valley, mango trees
and corrugated iron roofs hide away from the rest of the world under
a blanket of cozy clouds. But even when the clouds recede, the valley
wants nothing of the outside world. Not a single road leads to the largest
caldera, which sprawls across an area measuring 70 square kilometers, not even to the tower of rocks at its epicenter.
Our guide, Luc, tells us that some Mafate inhabitants have never seen the sea, even though their
Calling out his own name: the Réunion
Stonechat or Tek-Tek to the locals.
One of the many waterfalls
peppered throughout La Réunion.
cattle graze no more than 20 kilometers from the ocean. The people
here live at the heart of the former Île Bourbon, but know neither its capital, Saint-Denis, nor the sugar cane plantations near Saint-Pierre, nor the
beaches to the west or the vanilla plantations to the east. The fact that
everything is linked together by an oft-congested four-lane highway, is of
little interest to anyone in Mafate. They have no cars. To get to Mafate,
you have to walk, or fly. We trekked for six hours, 1200 meters down the
mountain, and 400 meters straight up. We traversed rivers on slippery
stones and crossed the misty rain forest, carried by the Creole call of our
guide: “La dodo le la” – the dodo’s there.
“The white dodo died out centuries ago,” recounts Luc. “But it still lives
on here on the island in our nickname for beer.” Hoisted by helicopter,
dodo beer even makes it up to Grand Place where mountain hut owner
Nicolas Bulin keeps plenty of supplies in his refrigerator. We may be a
good 10 hours from Europe, but we pay for our beer here in euros. Réunion is, after all, in Europe, though it’s a bizarre notion to grasp from these
peaks in the sky. Tenacious hikers from Bavaria stop for a breather on
the grass alongside exhausted Germans from the coast near Denmark.
The host adds seasoning to the carri poulet – hot and spicy rice with
chicken, accompanied by a cool, fresh beer. The indigenous population
were cultivating fruit and vegetables, and breeding goats and cattle here
long before the outside world got wind of the delights at the heart of
Réunion. Now, the hiking boom is bringing new jobs to the valley. Tracks
need laying, supplies need sourcing, huts need deliveries.
It’s five days on foot to one of the most active volcanoes in the world,
the Piton de la Fournaise. Its spewing spears of lava were worrying the
islanders as recently as 2007 but fortunately, by the time we get there,
it’s unlikely to be simmering. In the morning, the sun shines rosy pink
on a rock face that the clouds, in their mercy, had concealed the evening before. The sheer rocks mark the border to our second caldera, the
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An arching tree in the Plaine aux Tamarins forest, Mafate caldera.
Cirque de Cilaos. “Breathing keeps the legs moving,” announces Hans,
sharing his encouraging insights into hiking.
we descend to the Cirque de Salazie, accompanied by the rain which
transforms the paths into white water obstacle courses.
Up on the Col du Taïbit, our hard slog is rewarded by the view. Rugged
terrain here, mellow and meadow-like there, the caldera basks in sunshine with its gorges and sparkling waterfalls. To the south, the shimmering Indian Ocean, in front of it, the path to the next goal, the tamarind
forests of the neighboring caldera and Cilaos. The healing properties
of the springs here made the location famous in the 19th century. We
are greeted by bright pastel Creole houses, cafes and uncovered shops,
between them gallivanting children with features pieced together from
Indian, African and Creole ancestry, the typical emulsion of Réunion.
Teenagers race down alleyways on skateboards and mopeds, preventing
Cilaos from appearing a bit too idyllic.
The morning starts on a positive note, the anticipation of the volcano.
On the caldera rim, lush green gives way to a moonscape of ocher and
red. As we cross the desert-like plain, the last gray mists recede. This
most juvenile caldera is a fissured lava landscape, at its center the steepsided Bory crater. The old chimney is circled by younger ones, shooting
from the tiers. Open cones with sulfur yellow rims, surrounding by basalt
rocks that glitter in turquoise, orange, greens, fire red and gold. The
sun burns the skin. The sky radiates. Far away, threads of cloud slide
together over the Piton des Neiges. A lovely site, from afar.
The Piton des Neiges, Réunion’s highest peak at 3069 meters, really
takes its toll on us. Drizzle in the forest of Japanese cedars, heavier and
heavier as the trail ascends. Judging by the drenched figures traipsing
the other way, it’s no better at the pass. No “stunning views.” Instead,
rain-slicked agaves, sodden ferns, foggy rainforest. After three hours,
even the most expensive Gore-Tex boots are wet. No one’s cracked a
joke for ages. The hut looks like a flooded base camp. “Well, climbers are
nuts. Somehow they need this sort of thing,” concludes Hans.
Fortunately there’s dodo beer, carri poulet and upbeat neighbors. The
locals sing hymns about the P´tit fleur fanée, the vanilla blossom that
made Réunion famous for its bourbon vanilla. Then they taunt us about
our ski pole-like walking sticks: “I reckon the Germans think it really
snows on the Piton des Neiges, on the snow peak!” Not really. The views
are not much better in the morning. For a short moment, the peak towers above the clouds, a snippet of blue sky sweeps over the pass, followed by the next downpour. Instead of ascending the invisible peak,
v
Julica Jungehülsing
k JULICA JUNGEHÜLSING
Julica Jungehülsing lives in Sydney where she works as a freelance
correspondent, mainly for German-language magazines. She is a
member of the correspondent network weltreporter.net. Born in the
northern German city of Kiel, she previously worked as an author and
editor in Münster and Hamburg before moving to Australia in 2001. In
2007, her first book was published by Herder under the German title
“Ein Jahr in Australien” (A Year in Australia). As a teenager, she had to
be forced to go on her first hiking vacation. Now Julica Jungehülsing
adores cross-country hiking trips and one-day backpack excursions –
not just in her newly adopted home of Australia.
PATRIZIA
L IVE
LONG
O
EUR
k With over 600 employees on staff, PATRIZIA is active
PATRIZIA Immobilien AG
PATRIZIA Bürohaus
Fuggerstraße 26
86150 Augsburg, Germany
Phone +49 821 50910 - 000
Fax +49 821 50910 - 999
[email protected]
www.patrizia.ag
on the real estate market as both an investor and service
provider in more than ten countries. Over nearly 30 years,
the spectrum of services offered by PATRIZIA has grown to
include the buying, administration, value appreciation and
sale of private and corporate real estate. As a recognized
business partner to large institutional investors, the
company works nationally and internationally, covering the
complete real estate value chain. At present, the company
oversees real estate assets totaling nearly € 7.5 billion,
80 % of which is attended to on behalf of third parties,
mostly insurance companies, pension fund institutions,
sovereign wealth funds and mutual savings banks. Through
its capital investment companies, PATRIZIA GewerbeInvest
KAG and PATRIZIA WohnInvest KAG, PATRIZIA establishes
specialized real estate funds based on German investment
law, making it one of the most attractive partners in the
German real estate sector.
PE

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