Valuation Report `Matrix Portfolio, Valuation of 13 properties`

Transcription

Valuation Report ‘Matrix Portfolio,
Valuation of 13 properties’
prepared for Brack Capital Properties N.V.
January 2014
Matrix Portfolio, Valuation of 13 properties – January 2014
Contents
1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2 2.1 2.2 2.3 3 3.1 3.2 3.3 3.4 3.5 3.6 4 4.1 4.2 4.3 4.4 4.5 5 Brief & Scope of Instruction ................................................................................................................................. 3 Instruction ................................................................................................................................................................ 3 Fee Basis ................................................................................................................................................................. 3 Valuer Status ........................................................................................................................................................... 3 Purpose of Valuation................................................................................................................................................ 4 Basis of Valuation .................................................................................................................................................... 4 Liability ..................................................................................................................................................................... 4 Sources of Information ............................................................................................................................................. 4 Date of Valuation ..................................................................................................................................................... 4 Inspections............................................................................................................................................................... 5 Portfolio Analysis .................................................................................................................................................. 6 Overview .................................................................................................................................................................. 6 Distribution of Area Category and Rental Income .................................................................................................... 6 Distribution by Tenants ............................................................................................................................................ 7 Market Considerations .......................................................................................................................................... 8 German Economy .................................................................................................................................................... 8 German Investment Market: Summary and Current Developments ...................................................................... 10 Supply and Demand: Key Players in the German Real Estate Market .................................................................. 12 Retail Investment Market ....................................................................................................................................... 13 German Retail Warehouses and Retail Parks ....................................................................................................... 15 Transaction Evidence ............................................................................................................................................ 18 Valuation ............................................................................................................................................................... 20 Valuation Methodology .......................................................................................................................................... 20 Valuation Assumptions .......................................................................................................................................... 20 Valuation Results ................................................................................................................................................... 24 Sensitivity Matrix .................................................................................................................................................... 25 Market Value Disclaimer ........................................................................................................................................ 27 Confidentiality & Publication .............................................................................................................................. 28 Appendix I – Property Reports ...................................................................................................................................... 29 Appendix II – Overview ................................................................................................................................................... 30 Appendix III – General Principles for Valuation ........................................................................................................... 31 Valuation for accounting purposes only
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Contents cont’d
Figure 1: Development of gross domestic product (Q1/2011 –Q1/2013) – Seasonally and calendar adjusted .................. 8 Figure 2: Ifo – Business Climate Index January 2012 - May 2013 ...................................................................................... 9 Figure 3: Development of inflation rate / consumer price index “original values” (Jan 2012-May 2013) ........................... 10 Figure 4: Retail Transaction Volume Germany ................................................................................................................. 13 Figure 5: Transaction Volume Germany divided by Retail Asset Class ............................................................................ 14 Figure 6: Development of Prime Yields ............................................................................................................................. 15 Table 1: Portfolio Overview ................................................................................................................................................. 6 Table 2: Distribution of Area and Rental Income................................................................................................................. 7 Table 3: Distribution by Tenants ......................................................................................................................................... 7 Table 4: Transaction volume in Germany ......................................................................................................................... 11 Table 5: Transaction volume in Big 7 ................................................................................................................................ 11 Table 6: Transaction Evidence .......................................................................................................................................... 19 Table 7: Inflation forecast Germany .................................................................................................................................. 23 Valuation for accounting purposes only
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1 Brief & Scope of Instruction
1.1
Instruction
We refer to your instruction, dated 22 January 2014, instructing us to carry out a valuation of the Matrix Portfolio
consisting of 13 properties. The portfolio comprises retail parks and self-service department stores. The
instruction was ordered by Fred Ganea, Head of Financial Department of Brack Capital Properties N.V. (BCP)
1.2
Fee Basis
JLL confirms that the agreed fee structure for this mandate (Update valuation of the Matrix portfolio) is a fixed fee
and no fee which is linked in any way to the reported market value (% of value fee). Furthermore, JLL would like
to point out that the instruction letter (stating the fee level) referring to this mandate has been signed and agreed
by both parties prior to the start of the valuation process, on 22 January 2014.
1.3
Valuer Status
We confirm that the valuation has been carried out by us as external valuers, qualified for the purposes of
providing valuations in accordance with the Appraisal and Valuation Manual published by the Royal Institution of
Chartered Surveyors (RICS). We also confirm that we have no conflict of interest relating to the property and that
we have valued portfolios of a similar scope as well as larger scope in the course of other mandates.
The project team consists of the following members:
Andrew Groom
Since August 2001 Mr. Groom is head of the Valuation Advisory department in Germany with additional
responsibility for valuation business in Austria and Switzerland.
As International Director, Mr. Groom leads the overall direction of the Bank, Portfolio, Transaction, Residential
and Retail Valuation business lines as well as mortgage lending valuations for German mortgage banks (Team of
80+ consultants).
He is also responsible for providing client management within the scope of major German and international
mandates, comprehensive advisory services for real estate portfolios in terms of acquisition and disposal
strategies and advising leading banks with regard to risk classification in property financing.
Prior to that he gained management experience leading international advisory departments for CEI Investment
London and Drivers Jonas London as well as Berlin. Here he was not only responsible for the valuation
department, but also for the investment sector.
Andrew Groom holds a Bachelor of Science with Honours in Estate Management and is also a member of The
Royal Institution of Chartered Surveyors (MRICS) and a member of the RICS Valuation Faculty Board, Germany.
He has over 21 years development, valuation and international investment experience as well as over 18 years
management experience leading international advisory departments.
Frank Rambow
Since 2007 Frank Rambow is team leader of the Bank Valuation Advisory team of Jones Lang LaSalle’s
Valuation Department. Here he heads a team of 6 professionals. He currently holds the position of a National
Director.
Frank Rambow has lead several buy-side advices and real estate appraisals for single assets as well as
portfolios for various clients. All the valuations are conducted according to the IFRS standards.
He is a graduated economist and has over 15 years’ experience in real estate sector, thereof nine years at JLL.
Frank Rambow is a member of The Royal Institution of Chartered Surveyors (MRICS).
Valuation for accounting purposes only
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Norbert Schultek
In February 2012, Norbert Schultek joined Jones Lang LaSalle Germany, focusing mainly on the valuation of
retail and office portfolios/properties. He holds the position of Senior Consultant.
Norbert Schultek holds a Diploma of Real Estate Management. He possesses more than 6 years of consulting
experience on the German real estate market.
1.4
Purpose of Valuation
We understand that the valuation is required for financial statement reporting and that the valuation reports will be
included in the financial statement of Brack Capital Properties N.V.
1.5
Basis of Valuation
Our valuation has been prepared in accordance with the RICS Valuation – Professional Standards (9th Edition)
published by the Royal Institution of Chartered Surveyors as well as the standards contained within the European
Valuation Standards (EVS, 2012) and in accordance with IVSC International Valuation Standard 1 (IVS 1, 2011)
on the basis of Market Value.
According to the RICS Valuation – Professional Standards, Market Value is defined as:
“The estimated amount for which an asset or liability should exchange on the valuation date between a willing
buyer and a willing seller in an arm's-length transaction after proper marketing and where the parties had each
acted knowledgeably, prudently and without compulsion.”
Furthermore, the properties are considered as if free and clear of all encumbrances, i.e. easements, pre-emption
clauses, liens or any other restrictions on title. We have not taken into account any liability of the property /
portfolio owner regarding taxes, single or recurring public or private charges, local community taxes and costs.
However, our valuations are net of purchaser’s costs standard to the German property market.
1.6
Liability
Jones Lang LaSalle GmbH’s liability for any loss or damage caused by simple or gross negligence on our part,
irrespective of the legal reason, in relation to the valuation services provided is limited to a maximum of 10% of
the respective and reported Market Value per property, and may not exceed an aggregate maximum liability cap
of € 7.5 million (euros) for any case. A single case of damages is defined as the total sum of the damage claims
of all persons entitled to claim, which arise from one and the same professional error (offence). In the case of
damages suffered from several offences brought about by the same technical error within the scope of several
coherent services of a similar nature, the Advisor can similarly only be held liable for the foregoing maximum
liability amount.
1.7
Sources of Information
In preparing this valuation report, we have predominantly relied upon information provided by Brack Capital
Properties N.V. We received the documents listed below, which form the basis for our valuation:

Tenancy Schedule, dated 27 January 2014;

Current Land Register excerpts for all properties, dated 14 and 15 January 2014
In the event that this information proves to be incorrect or additional information is made available to us, the
accuracy of the valuation could be affected. In such case, we reserve the right to amend our opinion of value
accordingly.
1.8
Date of Valuation
As specified in your instruction, we have set the valuation date to be 31 December 2013.
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1.9
Inspections
For the current valuation, we did not conduct inspections. However, the properties were inspected by us in the
scope of the valuation in February 2011.
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2 Portfolio Analysis
2.1
Overview
The valued portfolio consists of 13 retail properties with a total net lettable area of 147,160 m². The properties are
spread throughout Germany and located in the federal states of Baden-Wurttemberg (4), Bavaria (4),
Brandenburg (2), North Rhine-Westphalia (1), Saxony (1) and Saxony-Anhalt (1).
Table 1: Portfolio Overview
No
Location
Address
Property Type
Lettable Area
1
06449 Aschersleben
Hoymer Chaussee 108
Retail Park
14,522 m²
2
86199 Augsburg
Gögginger Straße 119
Retail Park
13,770 m²
3
83043 Bad Aibling
Grassingerstraße 16
Retail Park
7,053 m²
4
88400 Biberach
Obere Stegwiesen 10
Retail Park
10,769 m²
5
46325 Borken
Heidenerstraße 32
Retail Park
9,524 m²
6
91054 Erlangen
Westliche Stadtmauerstraße 27
Retail Park
13,398 m²
7
73312 Geislingen
Gartenstraße 30
Retail Park
9,390 m²
8
08371 Glauchau
Waldenburger Straße F175
Retail Park
12,767 m²
9
71638 Ludwigsburg
Friedrichstraße 124
Retail Park
14,144 m²
10
14974 Ludwigsfelde
Potsdamer Straße 51
Retail Park
12,632 m²
11
74172 Neckarsulm
Hohenloher Straße 2
Retail Park
10,270 m²
12
94474 Vilshofen
Hösamer Feld 7
Retail Park
10,230 m²
13
19322 Wittenberge
Wahrenberger Straße 69
Retail Park
8,691 m²
147,160 m²
Source: Jones Lang LaSalle analysis, based on the provided detailed rent roll dated January 2014
2.2
Distribution of Area Category and Rental Income
The lettable area of the portfolio is predominantly used as retail (94%) followed by office (4%) and petrol station
(5%).
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Table 2: Distribution of Area and Rental Income
Area Category
Rental Income
(per month)
Lettable Area
Office
5,273 m²
4%
28,631 €
2%
Retail
138,443 m²
94%
1,003,725 €
87%
Commercial
0 m²
0%
0€
0%
Residential
1,571 m²
1%
9,657 €
1%
Storage
1,873 m²
1%
5,594 €
0%
Sub total
147,160 m²
1,047,607 €
91%
Petrol Station
7,262 units
5%
26,893 €
2%
Internal Parking
1,795 units
1%
40,146 €
3%
Other Units
1,552 units
1%
33,903 €
3%
Total
147,160 m²
1,148,549 €
100%
The distribution of the rental income is quite similar to the lettable area. The rental income of the portfolio is
predominantly achieved by retail (87%) followed by offie (2%) and residential (1%).
2.3
Distribution by Tenants
The tenants Kaufland and Marktkauf are individually the most important tenants in the portfolio. The covenant
strength of the two major tenants (Kaufland and Marktkauf) can be estimated as good to very good.
The main lease contracts (by income) of the main tenants generate approx. 42% (€ 5,840,444 p.a.) of the annual
rental income (€ 13,782,592/year).
Table 3: Distribution by Tenants
Rental Income
(per anno)
Tenant
Lettable Area
Kaufland
75,826 m²
52%
4,866,535 €
35%
Marktkauf
9,031 m²
6%
973,908 €
7%
AWG
5,574 m²
4%
646,656 €
5%
Adler Modemärkte
4,961 m²
3%
593,600 €
4%
dm-drogerie markt
2,171 m²
1%
292,122 €
2%
Deichmann
2,753 m²
2%
445,975 €
3%
Others
46,844 m²
32%
5,963,795 €
43%
147,160 m²
100%
13,782,592 €
100%
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3 Market Considerations
3.1
German Economy
Gross domestic product
Overall, economic growth has been slow over the past two quarters. The price-adjusted GDP for Q1 2013 was
just 0.1% higher than for Q4 2012. However, economic activity declined sharply in Q4 2012 (-0.7%) and the long
winters usually limit economic growth at the beginning of each year. These factors present the growth in Q1 2013
in a very positive light. Compared to Q1 2013, stimulus in Q2 2013 was mainly provided by increased private
expenses (+0.8%).
Investment continues to fall with a decrease of 2% in equipment investment compared to the previous quarter.
Despite decreasing exports of goods and services (-1.8%) and decreasing imports (-2.1%), net exports had no
influence on economic activity in the first quarter of 2013.
According to the German Institute for Economic Research (DIW), German industry is recovering from the
previous year’s low and shows evidence of growing economic strength. The institute’s economic barometer
shows a plus of 0.5% for Q2 2013. Industry has been expanding production since February and strong growth is
expected from the construction sector after loss caused by the long winter.
According to the DIW, employment has strengthened and increased wages are expected to boost private
consumer spending, which continues to support economic activity.
Figure 1: Development of gross domestic product (Q1/2011 –Q1/2013) – Seasonally and calendar
adjusted
Source: Federal Statistical Office, June 2013
Business Climate
The Ifo business climate index rose from 104.4 in April to 105.7 in May 2013. This reflects the positive change in
how businesses viewed the current situation as well as future development.
An improved business climate in manufacturing led to positive assessments of the current business situation.
Despite a slight decrease in export demand, future expectations are still optimistic.
Business confidence in the wholesale sector has improved in comparison to the previous month, characterising
the current climate a well as future expectations.
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The climate in the retail sector improved for the fourth time in a row, reflecting positive future expectations.
Business expectations in the construction industry were not as positive in May, despite the optimism in previous
months.
The Ifo business climate index for the service sector rose significantly in May and expectations for the upcoming
months are optimistic.
Figure 2: Ifo – Business Climate Index January 2012 - May 2013
Source: Ifo-Institute, June 2013
Price development
According to the Federal Statistical Office (Destatis), the consumer price index for Germany in May 2013
increased by 0.4% compared to the previous month and 1.5% compared to a year earlier (May 2012).
Food prices have been above the total consumer price index since January 2012 and were the main driver of the
price increase in May 2013 (+5.4%). Electricity prices rose by 12.4% and energy by 1.6%. Mineral oil products
decreased by -4.3% compared to May 2012.
From January 2012 to May 2013, food prices rose by 5.4% and continue to exceed the overall rate increase.
Within a year, vegetable prices went up by 12.1%, fruit by 9.2%, meat and fish by 5.6%, dairy products and eggs
by 4.3% and bread and cereal products by 2.3%.
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Figure 3: Development of inflation rate / consumer price index “original values” (Jan 2012-May 2013)
Source: Federal Statistical Office, June 2013
3.2
German Investment Market: Summary and Current Developments
Investment market achieves best year since 2007 – lettings market stabilises considerably with a positive
outlook for 2014
In retrospect, 2013 performed better in economic terms than many had expected. Germany has already
compensated for its stagnant development in 2009, and its absolute economic output has now exceeded precrisis levels for three years.
The forecast for 2014 is GDP growth of 1.7% after 0.7% last year. This provides the basis for a sustainable
recovery with correspondingly positive business prospects and an improved jobs market.
In spite of the rather subdued economic recovery, Germany again registered a new employment record in 2013.
On average around 41.8 million men and women were in paid employment last year – more than ever before.
This means that the number of those in paid employment reached a new peak for the seventh year in succession.
Service providers again provided most of the new jobs, creating 227,000 posts and accounting for around three
quarters of all workers.
The euro crisis is still very much present, but was put into more perspective over the year so that the worst of the
recession in the Eurozone appears to be over for the time being. The stabilisation of the economy as a whole was
admittedly bought at a high price - with “cheap” capital available by virtue of the very low interest rates. The
prospect of higher interest rates will hang like the sword of Damocles over all first-world economies in the short
and medium-term. While the borrowing of funds at low interest rates seems attractive on one hand, on the other
hand it is regarded as increasingly problematic with regard to return on investments. In particular, institutional
investors such as insurance companies and pension funds are coming under increasing pressure to achieve their
targeted rates of return. The era of “cheap money” will continue into 2014 and further increase investment
pressure. The real estate industry will initially benefit from this.
Property gained further importance as an asset class in 2013 and will also remain at a high level in 2014. This is
because the global investment requirements of institutional investors remains high and there is a lack of attractive
alternatives due to the low interest rates. However, since there is no let-up in investor interest in Core products
the lack of suitable products in the property sector limits the investment volume in this asset class. Although we
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have noticed a greater willingness to accept risks beyond the Core segment, the largest volumes will nonetheless
still be invested within the Core segment. Even if the completions volume for new office properties increases
again in the Big 7, it will not come close to resolving this product bottleneck. The German investment market
could gain further momentum, but this will only be poorly documented by the bare market statistics. The buyer’s
market is much better than the figures from contract signings suggest.
Strong demand for commercially used investment property drives the transaction volume
On the investment market in 2013, total capital amounting to € 30.7 billion was invested in German commercial
property – an increase of about 21% compared to the previous year. This means that 2013 was the strongest
year for property transactions since the boom year of 2007. As was already seen in the previous year, the final
quarter of the year proved to be the strongest in terms of transactions. Property worth around € 11.5 billion
changed hands in the months from October to December, and this volume was also € 1.5 billion higher than in
the fourth quarter of the previous year. Not all transactions that were initiated could be notarised in the last days
of December, so that we expect to see a very lively start to 2014.
The good economic outlook on the domestic market also provides a basis of trust for property market participants
and attests to the attractiveness of Germany as a property investment destination. At the same time this interest
is equally supported by foreign and domestic investors.
Table 4: Transaction volume in Germany
Transaction volume Germany (million Euro)
Single assets
Portfolio
Total
2012
2013
%*
18,980
23,050
21%
6,320
7,650
21%
25,300
30,700
21%
*% is defined as percentage change between 2012 and 2013
Source: Jones Lang LaSalle analysis
Table 5: Transaction volume in Big 7
Transaction volume Big 7 (million Euro)
2012
2013
%*
3,950
3,530
-11%
Düsseldorf
740
2,180
195%
Frankfurt/M
3,250
4,100
26%
Hamburg
2,000
2,950
48%
830
1,190
43%
Munich
3,860
4,680
21%
Stuttgart
1,020
860
-16%
15,650
19,490
25%
Berlin
Cologne
Total
*% is defined as percentage change between 2012 and 2013
Source: Jones Lang LaSalle analysis
The relation between the investment volume in the Big 7 and investments outside these established markets has
not changed from 2012. As before, around 60% (€ 19.5 billion) was invested in Berlin, Düsseldorf, Frankfurt,
Hamburg, Cologne, Munich and Stuttgart. Retail property was of primary interest in other cities. High purchasing
power and centrality indicators in densely populated and economically strong catchment areas combined with
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strong demand from tenants such as national and international retail chains means that second-tier cities are also
of interest to investors.
3.3
Supply and Demand: Key Players in the German Real Estate Market
Asset/fund managers and special funds formed the strongest buyer group in 2013. These two groups invested a
combined € 10.5 billion in commercial property and therefore accounted for a third of the total investment volume
noted for 2013. One fundamental difference was that while most foreign fund management companies sold more
properties last year and therefore on balance reduced their overall property holdings in Germany, special funds
are clearly net buyers (with a balance of € 4.2 billion). Insurers, pension funds property companies and REITs
also bought more than they sold, as did private investors including family offices.
Open public funds were ranked in third place among the buyers. That this type of investor is also currently a net
seller comes as no surprise. The division of the sector into active and cash-rich funds on one side and funds in
the liquidation phase and therefore obliged to sell on the other is becoming increasingly obvious. When open
funds do buy, they mainly buy office properties. Closed funds also acted with more caution over the year, but in
contrast to the open funds they sold far fewer properties and therefore built up their property holdings on balance
with a focus on retail property. The sales activities of banks also make for an interesting analysis. Due to some
large portfolio sales (e.g. Max Bahr Immobilien by RBS), banks have increased their current share of the sales
volume to 6%.
Also in 2014 we do not expect to see a big sell-off of distressed property assets by banks. There will be isolated
instances of such properties or portfolios coming onto the market, but for the most part these should be liquidated
relatively quietly and in small steps. The pressure to sell has been reduced through amortisation, rental
increases, the overall positive market development and the low interest rates.
Domestic investors increased their share of the total transaction volume (all commercial property asset classes)
to 67% from 58% in 2012, while the share of foreign capital fell slightly as a result. However, this in no way
signifies that interest from foreign capital is waning. Foreign investors make an appearance in almost all major
transactions, but do not always close a deal. Worth noting is the interest of foreign investors in portfolios: the
share of foreign capital in such transactions reaches around 45%. In addition, in absolute terms foreign investors
acquired properties worth around € 10.1 billion in 2013, and this is only marginally less than in 2012 (€ 10.5
billion).
Office property remains the strongest asset class
The analysis of the different asset classes reveals no fundamental differences from 2012. Office properties again
accounted for the highest share of the transaction volume at 46%. Retail properties accounted for a 26% share,
followed by mix-used properties with 11% and warehouse and logistics properties with at least 7%.
Forecast 2014
For 2014 we expect a stable development overall for yields. Based on the continuing strong demand for prime
properties the prime yields could even fall slightly again. At the same time, it will also depend on how the capital
market environment develops during the year. The interest rates will probably stay low and therefore offer an
attractive environment for companies and debt-oriented investors. A reduction in the risk premium (on the basis of
10-year government bonds and the prime yield for office properties) from almost 300 basis points at present to
around 260 by the end of 2014 will also not restrict investments in German commercial property.
Financing options for Core investments also remain in force in 2014. Traditional lenders as well as increasingly
insurance companies and pension funds are still providing loans. For both groups, the debt-financing business is
an attractive area of activity in the light of Solvency II. Rising competition among lenders will increase the
pressure on margins in 2014, and this is in combination with a slight increase in loan maturities against the
background of a moderate rise in risk appetite. A further adjustment of the book values among today’s property
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owners as well as risk-neutral banks, which are also providing more financing for property other than Core
products, could create an even stronger impetus on the German investment market in 2014.
3.4
Retail Investment Market
Retail Investment Market: Review of 2012 and 2013
In 2012, the German economy experienced a period of growth that slowed in 2013. Since then, growth has
remained stable at a low level. This situation has greatly contributed to demand from international real estate
investors for property in Germany. Following a recovery in 2010, the economy, employment rates and income
grew significantly, but growth slowed in 2011. This caused a ripple effect in the retail sector.
In 2012, retail investments totalled € 7.9 billion compared to € 10.7 billion in 2011. Hence, retail investments
accounted for 45% (2011) and 31% (2012), of total real estate investment. In 2013, a total of € 8.1 billion was
invested, reflecting 26% of total real estate investment. Retail investment reached its highest level in 2011,
slowing in 2012 through Q1 2013; since then, growth has remained stable.
Figure 4: Retail Transaction Volume Germany
Source: Jones Lang LaSalle, January 2014
In the retail investment market, the shares of some of the asset classes shifted between 2012 and 2013.
The share of shopping centres remained relatively stable at 34% in 2013 (2012: 39%). High street
properties/department stores dropped from 38% (2012) to 30% (2013) and represented the second largest share
of the retail transaction volume. Retail warehousing solus units had the third largest share with 16% (2012: 5%).
Retail park investment represented 12% (2012: 15%) and supermarkets/ discounters 8% (2012: 2%).
In 2011, large transactions drove up total investment in shopping centres, high street properties and department
stores. In 2012, large transactions included the sale of KaDeWe and 17 Karstadt properties from Highstreet
(Whitehall, RREEF and others) to Signa Holding, Europa Galerie in Saarbrücken from Credit Suisse to Union
Investment (CS Eureal) for approximately € 170 million, 45% of the Europa Passage in Hamburg for € 184
million, shares of five shopping centres from Perella Weinberg to Unibail-Rodamco for approximately € 500
million and 78% of the Milaneo shopping centre in Stuttgart for approx. € 400 million. Furthermore, the RathausCenter in Monheim was sold at an unpublished price by Vald and ZIAG to Phoenix. Sahle-Gruppe bought
Karstadt on Zeil in Frankfurt (€ 115 million). Morgan Stanley, in a joint venture with Redos Real Estate, bought 11
13
Toom DIYs for approximately € 100 million. The Saturn store in Hamburg was bought in a joint venture of Matrix
and Munich investors for an estimated € 80-90 million. Large transactions in 2013 include the purchase of 30
retail properties for approximately € 150 million by Catalyst Capital, the sale of a specialist store portfolio
comprising 80 properties for € 135 million, the purchase of Kaiserplatz-Galerie in Aachen by KG Farmsen for
approx. € 290 million, the purchase of Kö-Bogen in Düsseldorf by Art-Invest for approx. € 400 million, the
purchase of Hallen am Borsigturm by ECE for approx. € 170 million, the sale of the Deikon portfolio (84 stores for
approx. € 170 million), the sale of Leine Center for € 117 million to CBRE investors, the sale of the Monsoon
portfolio for approx. € 220 million to Cerberus, the purchase of Kröpcke-Center in Hannover for € 180 million by
Union Investment, the purchase of Neumarkt-Galerie in Cologne by Deka Immobilien for € 300 million from
Signature Capital the sale of the Redefine portfolio for € 190 million.
Figure 5: Transaction Volume Germany divided by Retail Asset Class
Yields in the Retail Market decrease
As mentioned above, shares of retail assets in the real estate investment market went down from 31% in 2012 to
26% in 2013. Furthermore, in most retail property classes, the gap between sellers and buyers has decreased,
but a clear lack of product remains. The gap between buyers and sellers is most clearly seen in core properties.
Yield compression could be observed, particularly in the core asset class, from 2009 until H1 2011 and again in
H2 2012 with respect to retail parks, shopping centres and high street shops/department stores. Prime yields for
shopping centres were close to 5% in 2012, but went down in Q4 2012 and remained at 4.75% since then.
Recently, prime yields have shown a tendency to drop to 4.7% Prime yields for shopping centres are now equal
to prime yields for prime offices. Net initial yields for prime retail parks went down to approximately 6% at the end
of 2011, remained stable until Q3 2012 and then decreased to just below 5.75%. By the end of 2013, net initial
yields dropped to 5.65%. Prime yields for high street properties were at approximately 4.15% during 2012,
decreasing slightly in 2013 to 4.05%.
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Figure 6: Development of Prime Yields
Retail Investment Market: Outlook
Because Germany’s economy has been very stable in the past several years, showing signs of growth, we
observe retail among the largest of asset classes in 2013. Investors seeking a core investment with upward
potential will find the best fit in retail. Alternative options beyond core investments such as value-added assets,
assets with shorter rental contracts or vacancies are increasingly considered. As a result, the investment focus
has broadened to include secondary locations. An increase in transaction volume of distressed properties and
non-performing loans can be expected in the course of 2014. With respect to retail properties, we expect a
progressively stable trend with the highest investment share anticipated for shopping centres and high street
properties. Furthermore, we predict that the German real estate market will remain the focus of foreign investors.
In 2013, asset/fund managers and developers were by far the most active sellers of retail properties. At the same
time, banks/insurances/pension funds, asset/fund managers as well as special funds were the most active
buyers. We expect this situation to continue into 2014.
3.5
German Retail Warehouses and Retail Parks
The following section presents a more detailed overview of retail warehouses with a specific focus on “Do-ItYourself” (DIY) stores, furniture stores, electronic goods stores, hypermarkets and cash & carry markets as well
as retail parks and retail agglomerations. The subject matter will concentrate on the classification of these types
of retail establishments, providing information on the special characteristics, the most well-known tenants, the
deciding regional factors and information regarding the present situation in the German real estate market in view
of the current rental level and the investment market.
Retail Warehouses
Definition
Retail warehouses are large-scale forms of retailers. They offer a broad and often very deep range of different
products for different requirements and for specific target groups. Retail warehouses usually operate using a selfservice format with a self-explanatory product selection, which is clearly presented to the customer. The need for
15
good presentation and the broad and deep product range contribute to large sales areas. On the other hand,
fewer sales staff is needed due to the self-service character. In combination with a good area performance and
efficient stock keeping, the costs for retail warehouses are easily managed. Additionally, the majority of retail
warehouses are chain stores with a basic concept. The construction of such concepts entails economic
advantages, with products that can be and mostly are offered at lower to medium price levels.
Among retail warehouses, different types and branches can be distinguished. Retail warehouses can differ in
service orientation and price level. There are more service-oriented warehouses (higher prices, more services)
and more discount-oriented warehouses (lower price, less services). Plus, even though retail warehouses are
usually large-scale, they can be distinguished based on their size and location.
Small retail warehouses have an area of approx. 200 to 1,200 m² and are located within a suburban location with
good traffic connections. Tenants are usually hardware stores, office supply stores or drugstores. Medium retail
warehouses comprise stores with an area of up to 3,500 m² and are located both in suburban areas and in the
outskirts of towns and cities. Typical tenants include sporting goods stores, toy stores, electronic goods stores,
large shoe stores, large hardware stores and auto supply stores. Large retail warehouses have an area of more
than 3,500 m² up to 18,000 m² and are usually located in peripheral locations. However, these stores are
increasingly being developed in more integrated locations. Typical tenants are large fashion retailers, toy stores,
electronic goods stores and DIY stores. The biggest retail warehouses reach a size of up to 30,000 m². Due to
their size, these stores are normally found exclusively in peripheral locations or on Greenfield sites. This size is
usually only occupied by furniture stores. The branches and tenants for retail warehouses are diverse and
depend on the strategy and orientation of the subject property.
Locational Factors
Since the time they originated in the mid-1980s, retail warehouses are typically situated in peripheral locations in
cities (e.g. commercial areas). This distinguishes a retail warehouse from conventional specialist stores, which
traditionally prefer city centre locations. The motivation to move to Greenfield sites results mainly from the lower
rental rates compared to the city centre, the fact that expansion is easier in the periphery (especially for largescale retail warehouses), as well as the possibility to use simple building methods to affordably construct on a
large scale (with regard to sales area and parking spaces). Together with more efficient organisation, this allowed
products to be offered at lower prices than in traditional retail formats. Retail warehouses and their concepts are
thus posing an ever greater threat of competition for the city centres. This means that continuous adjustment and
development of concepts is necessary to remain competitive for both city centres and retail areas in the
periphery.
Location factors can be differentiated by the macro-location and micro-location. The most important factor on a
macro-level is the population and all factors directly and indirectly associated therewith. The first is the population
of the locality and the number of people living in the catchment area of the respective property. In this context,
future population development is another important factor given the long-term use of such real estate. Another
factor concerning the population is the purchasing power. The more specialized retail warehouses are, the more
purchasing power matters. This is because the costs associated with food, for example, do not depend on
purchasing power as much as the costs associated with electronics or DIY-store goods. Factors like tourism
potential and commuter balance play a less significant role. Given the increasing difference concerning the
mentioned macro-location factors in Germany, these factors are continually gaining importance in the valuation of
real estate.
On a micro-location level an important factor is the traffic infrastructure. As retail warehouses mostly rely on
customers travelling by car, sufficient parking spaces as well as a good traffic infrastructure are very important.
Thus, retail warehouses are often found along major arterial roads in commercial or industrial zones. Public
transportation plays a less significant role but is important as well. Another important factor is the development in
the vicinity. Further retailers in the vicinity can produce benefits from synergy effects or if retailers have a similar
16
product range they can form competition. A residential population in the vicinity can also be beneficial, as people
living in the surrounding area of a retail warehouse can significantly increase the customer frequency.
Rental Market
There is no homogeneous rental level for retail warehouses throughout Germany. Nevertheless, the spread
between the rental levels is not as big as in high street locations. The maximum rents are determined by a
percentage of the turnover expectancy as is common in the retail sector. The turnover again is most dependent
on the above-mentioned macro- and micro-location factors of the retail warehouses plus the characteristics of the
property like quality and concept of the store, architecture and visibility from the adjacent streets.
The economic difference throughout Germany has led to differences in rental levels throughout the country.
Rents in Bavaria, Baden Wuerttemberg and the metropolitan regions around Hamburg, Frankfurt or Berlin, lie
above the average rent in Germany due to the high population density, the positive population forecast and the
strong economy. Rental levels in eastern German towns are generally slightly lower than their western
counterparts, as these areas have a lower purchasing power, higher unemployment rates, most often a negative
population development and therefore generate on average lower revenues.
Depending on the size of the retail unit and the branch of the tenant, rents for retail warehouses in Germany
usually range from € 5.00 and € 14.00/m²/month. However, there are exceptions in both directions. The highest
rents are not paid in peripheral locations but in locations in or near the city centre of larger cities with more than
100,000 inhabitants. Usually these prime rents are paid by well-known and attractive tenants, which occupy
buildings in very good conditions. The rents for retail warehouses in general in Germany have been relatively
stable in the past 10 years. However, the future rental development of retail warehouse will be mainly determined
by the growing regional differences. The rental levels will remain stable in sustainable locations and in absolute
top locations there is the probability of small increases. But, locations in economically weak regions with negative
population development were and are going through difficult development. Therefore, less sales area is needed
there due to the migrating population. This leads to an oversupply of rental areas, which again leads to falling
rental levels.
Retail Parks
Definition
Retail parks are planned retail warehouse agglomerations. A retail park generally consists of at least three largescale retailers with a combined retail area of at least 3,000 m². Similar to large retail warehouses, they usually are
situated in locations reachable by car, close to traffic arteries or federal highways. In contrast to unplanned retail
warehouse agglomerations, retail parks are built in order to effectively benefit from synergy effects and cultivate a
collective corporate identity as well as a visual and spatial appearance. They usually have a shared, central car
park and advertise their tenants through traffic cones at the access points. Although distinguished by their plain
and functional architecture, retail parks have many similarities to shopping centres. One similarity is the central
planning and management of the retail park. Instead of letting random tenants into the property, it is the retail
park manager’s task to optimise the tenant mix in order to maximise synergy effects. The manager is further
responsible for organising the retail park’s external appearance through shared marketing measures and also
functions as a contact for clients, tenants and the landlord.
Retail Agglomerations
In comparison to retail parks, agglomerations of retail warehouses have also often been developed in order to
take advantage of synergy effects with other retailers. However, these developments are not strategically
planned. Agglomerations are created with the successive settlement of retail warehouses. This usually develops
over an extended period of time without central planning, management or operation. Similar to retail parks, the
joint usage of infrastructural components and joint marketing are synergy effects arising from such an
agglomeration, resulting in an extension of the catchment area and an increase of the competitiveness relative to
other retail agglomerations. Two common forms can be distinguished: retail warehouse strips and clusters. While
17
retail warehouse strips develop through the successive construction of retail warehouses on a linear axis along a
single road, clusters develop through the construction of further retail warehouses around a centrally situated
store. Often such developments evolve chaotically and seldom benefit from shared parking lots.
The concept of “one-stop shopping”, which is offered by retail parks and retail agglomerations, will play an
increasingly important role in the future when shopping for provisions, because time is becoming more and more
important to individuals. As a result, individual or sparsely clustered discounters and supermarkets will become
increasingly unappealing.
Rental Market and Tenant Mix
The tenant mix of a retail agglomeration or retail park is very important for the overall quality and success of the
property. The rental rate for such properties – as is common in the retail sector – is tied to the turnover
expectancy (normally as a percentage). A good tenant mix and combination of brands and offers is able to satisfy
several consumer requirements and guarantees a good customer flow. In order to increase the overall quality of a
retail park or retail agglomeration, tenants selling daily convenience goods and tenants with a periodic or leisure
component should be combined within the property. The combination of goods and services supports the
consumers’ time management and therefore, appeals to the customer and offers an advantage compared to a
stand-alone supermarket, for example.
The opportunity to link purchases with different store characters (periodic and irregular, impulse and target
purchases, etc.) varies depending on the main range of goods. In particular, branches with a very high leisure
character are easily linked to each other, for example fashion and shoes, leatherwear, toys and jewellery. Purely
supply-orientated tenants (for example supermarkets, discounters, bakeries and drugstores) have similar linkage
potential. Target-oriented purchases like furniture purchases or DIY-purchases have a lower potential for linkage
as they are very sporadic and usually require higher investment. Therefore, the information and the time
requirement are higher and these purchases are normally not combined with other purchases.
If in the case of a retail park, the management succeeds in establishing good anchor tenants, which increases the
customer frequency, then the turnover expectancy of secondary tenants tends to be higher. As a consequence,
their overall rental level can be higher as well. Therefore, some anchor tenants are able to negotiate lower rents,
because their existence in a property increases the rental level of the others, thereby compensating for the higher
rents. Thus, the rental level of a large anchor store within retail parks, like a supermarket or hypermarket, tends to
be lower than if it was a stand-alone store. In contrast, smaller retail warehouses within retail parks, which benefit
from large anchor tenants, tend to pay higher rents than if they were stand-alone stores. Overall, retail parks have
the potential to generate higher rents than stand-alone retail warehouses due to the higher customer frequency.
The discrepancy between the average and prime rents is usually between € 5.00 and € 6.00/m²/month.
Depending on the size of the retail unit and the branch of the tenants, rents in retail parks in western German
locations generally range between € 5.00 and € 15.00/m²/month. However, there are exceptions in both
directions. The current prime rent for retail warehouses ranges from € 10.50 to € 18.50/m²/month. The prime rent
of € 18.50/m²/month is usually not paid in peripheral locations but in locations in or near the city centre of larger
metropolitan areas (> 100,000 inhabitants) by well-known and attractive tenants occupying buildings in very good
condition. The prime rent for retail warehouses in Germany has been virtually stable in the past 10 years. In the
first quarter of 2002, the prime rent ranged from € 9.79 from 18.60/m²/month.
The overall potential for rental growth of retail warehouses in Germany is best summed up as mediocre.
Depending on the tenant branch, rental rates for discounters, department stores and DIY stores remain stable
due to the high competition in the market, but the rents for fashion stores have uplift potential simply due to the
fact that these stores are increasing their presence in retail parks and are prepared to pay high rents.
3.6
Transaction Evidence
Please find some transactions from 2010 until 2013 in the table below.
18
Table 6: Transaction Evidence
Property Type
Location
Federal State
Lettable Area
m²
Sales Price
(EUR)
WALT
Multiplier
Date of
Transaction
Supermarket/
Discounter
Portfolio
throughout
Germany
n.a.
39,465
approx. € 35m
6.7
8.3-fold
Q3 2013
Supermarket
Portfolio
throughout
Germany
n.a.
148,644
approx. € 190m
7.7
11.0-fold
Q4 2013
Discounter
Portfolio
throughout
Germany
n.a.
n.a.
n.a.
6.5
approx.
7.5-8.0-fold
Under
negotiation
Retail Portfolio
throughout
Germany
n.a.
41,049
approx. € 29m
5.1
7.1-fold
Q4 2010
Furniture Store
Jever
Lower Saxony
13,000
n.a.
9.3
13.8-fold
Q2 2012
NIY approx. 6.4%, single tenant
Supermarket
Düren
North RhineWestphalia
2,080
2,000,000
9.7
9.4-fold
Q1 2012
Located in Düren, purchasing
power index of 87.5; built in 2008
Discounter
Wuppertal
North RhineWestphalia
1,000
3,250,000
8.5
11.5-fold
Asking price
Discounter occupied by Netto, built
in 2007, current rent € 282,600 p.a.
Retail Park
Gera
Thuringia
5,282
4,795,000
6.1
8.75-fold
Q2 2012
Retail Park, main tenant Rewe, built
in 2006
Retail Park
Kirchberg
Saxony
3,403
3,135,000
4.4
7.75-fold
Q3 2012
Supermarket /
Discounter
Eberswalde
Brandenburg
930
1,301,256
9.9
11.0-fold
Q1 2012
Supermarket /
Discounter
Brieselang
Brandenburg
1,087
1,569,414
8.8
10.75-fold
Q1 2012
Comments
21 properties; NIY approx. 9.510%; construction dates 20002004; approx. € 887/m²
90 properties; NIY approx. 7.75%;
good macro and micro locations;
approx. € 1,282/m²
50% of the properties located in
eastern Germany; construction
dates 2002-2005
26 properties; construction dates
mainly in the 1990s; approx. €
700/m²
Retail Park, main tenant Rewe,
constructed in 2004, vacancy rate
of approx. 3%
NIY 7.82%. Located in Eastern
Germany with weak economic and
demographic background
(decreasing population). Built in
2006. The unemployment rate is
12.5%, which is above the federal
average.
NIY 8.11%. Located in Eastern
Germany. The unemployment rate
is 12.5%, which is above the
federal average. Built in 2006
* Multipliers are gross multipliers if not mentioned otherwise.
Source: Jones Lang LaSalle research
19
4 Valuation
4.1
Valuation Methodology
Our valuation provides an estimate of Market Value. The definition by the ‘Royal Institution of Chartered
Surveyors’ outlined below applies to the underlying values quoted in the valuation.
The Market Value of the property has been assessed using the Discounted Cash Flow (DCF) calculation method.
This takes into account the agreed rent for the signed leases, the market rent for currently vacant space and
estimated rents for re-letting of the space after lease term expiry.
Cash flows for the relevant year are calculated as follows: the Rental Income at full occupancy (Base Rental
Revenue) is reduced by the loss of rent due to rent–free periods (Base Rent Abatements) and vacancy
(Absorption and Turnover Vacancy). Besides income from indexation clauses (CPI and Other Adjustment
Revenues) and step rents (Base Rental Step Revenue), reimbursable expenses (Vacancy Costs) have been
added to obtain the Total Potential Gross Revenue. While rents are calculated according their particular
adjustment clause, costs have been adjusted according to the change in the Consumer Price Index (CPI) on a
yearly basis.
After deduction of the non-recoverable costs (i.e. Management and Maintenance Costs) and reimbursable
expenses (Vacancy Costs), the Net Operating Income (NOI) is determined. In case of vacancy, the reimbursable
costs the landlord receives are lower than the amount he has to pay, so that only in this event do Vacancy Costs
have an influence on the NOI.
Subtracting the non-operating costs (such as Leasing Commissions, Tenant Improvements and Capital
Expenditures) from the NOI results in the Cash Flow before Tax and Debt Service.
After the DCF period of 10 years, we have considered a stabilised rental income in year 11. The capitalised value
after year 10 takes this stabilised rental income and subtracts the stabilised expenses, resulting in the Stabilised
Net Operating Income. This result is capitalised into perpetuity applying an equated (growth implicit) yield and
produces the Terminal Value Indication. The resulting value is then discounted to the valuation date using the
discount rate from term year 1-10.
Discounting the remaining Cash Flows for years 1 to 10 and the Terminal Value for year 11 to the valuation date
(i.e. the Net Present Value) produces the Gross Capital Value. We have assessed monthly rents as this conforms
to the timing of rental payments. Subsequently, the Cash Flows calculated across the valuation period are
discounted to the valuation date monthly in advance using the market derived discount rate. The discount rate
adopted considers the probability of default as well as the security of the forecast for the Cash Flow. Therefore,
factors which influence the discount rate include existing terms and conditions of lease contracts, the individual
location quality, the building structure and building stock, the strengths of tenant covenants, the prevailing overor under rent and the resale value calculated. After deductions for Purchaser’s Costs, the Market Value is
obtained.
4.2
Valuation Assumptions
Definition Market Value
Our valuation has been prepared in accordance with the RICS Valuation – Professional Standards (9th Edition)
published by the Royal Institution of Chartered Surveyors as well as the standards contained within the European
Valuation Standards (EVS, 2012) and in accordance with IVSC International Valuation Standard 1 (IVS 1, 2011)
on the basis of Market Value.
20
According to the RICS Valuation – Professional Standards, Market Value is defined as:
No allowances have been made for any expenses of realisation or for taxation (including VAT), which might arise
in the event of a disposal. We do not take into account any liability of the portfolio owner regarding taxes, single
or recurring public or private contributions, charges, local community taxes and costs. However, our valuations
are net of purchaser’s costs standard to the German property market.
Rental Income
The current rental income for the portfolio amounts to € 13,782,592/year, which equals a rent of € 7.80/m²/month
on occupied areas.
Property
No
Town
Rental Income
Contractual
Rental Income
Contract Rent
€ p.a.
€/m²/month
1
Aschersleben
1,520,129
8.72
2
Augsburg
1,203,705
7.28
3
Bad Aibling
636,025
7.52
4
Biberach
1,262,394
9.77
5
Borken
996,674
8.72
6
Erlangen
1,164,606
7.24
7
Geislingen
640,469
5.68
8
Glauchau
1,264,953
8.26
9
Ludwigsburg
1,013,225
5.97
10
Ludwigsfelde
1,208,820
7.97
11
Neckarsulm
1,381,692
11.21
12
Vilshofen
869,192
7.08
13
Wittenberge
620,708
5.95
13,782,592
7.80
Estimated Market Rental Value
In the scope of the valuation, an achievable market rent was derived for each rental unit of the buildings within the
portfolio.
The estimate of market rents is made on the basis of comprehensive research and our turnover analysis. As a
result, the Estimated Rental Value for the portfolio amounts to € 15,101,395/year. This represents
€ 8.55/m²/month.
21
Property
No
Town
Rental Income
Market Rental Value
Market Rent
€ p.a.
€/m²/month
1
Aschersleben
1,595,689
9.16
2
Augsburg
1,487,432
9.00
3
Bad Aibling
695,930
8.22
4
Biberach
1,282,235
9.92
5
Borken
1,226,337
10.73
6
Erlangen
1,625,168
10.11
7
Geislingen
835,732
7.42
8
Glauchau
1,197,680
7.82
9
Ludwigsburg
1,332,505
7.85
10
Ludwigsfelde
1,085,152
7.16
11
Neckarsulm
1,276,200
10.36
12
Vilshofen
869,452
7.08
13
Wittenberge
591,881
5.68
15,101,395
8.55
Costs
For the purpose of the valuation on 31 December 2013, the non-recoverable costs (e.g. insurance costs as well
as ground tax) remained unchanged and have been applied according to information received during the previous
valuation cycle. Management costs and maintenance costs have been applied according to internal benchmarks.
The previous owner did not recover all costs, which could be recovered according to the lease contracts. We
understand that the lawyers of BCP see that in the future these costs will be reduced and a higher portion will be
recovered. We assumed that if the tenants would be provided with an accurate cost schedule they will pay these
(recoverable) costs.
Vacancy Costs
In periods of vacancy, all fixed ancillary costs are borne by the owner. This fact has been taken into account
within the valuation and in the case of projected vacancy during re-letting or successive rental; furthermore, we
have applied a non-recoverable surcharge for vacant space. The vacancy costs are assessed to amount to
€ 10/m²/year.
Renewal Probability
Following the lease contract periods, we have considered assumptions appropriate to the local market
environment regarding use type, location, quality of rental areas and property condition. Rent-free periods were
not assumed for the re-letting/initial letting of any units. Void periods have been applied for re-lettings/initial
lettings and leasing commissions were taken into account to secure new tenants. Depending on the respective
area, we have incorporated tenant improvements after lease term expiry. We have predominantly assumed that
the existing leases will be extended with a renewal probability of 75% (at market rental level) and leases will be
agreed with new tenants with a corresponding probability of 25% (also at market level). Therefore, costs in the
cash flow related to re-letting and the void period are weighted with the aforementioned likelihood of 25%.
22
Void Periods
The period of vacancy before re-letting depends on the location, building quality and demand. For the rental units,
a specific vacancy period between 3 and 24 months was assumed. Given that marketing to identify new tenants
can commence as soon as an existing tenant has submitted notice, the usual notice period for the tenant is taken
into account (i.e. deducted) when determining the void period. However, the period of vacancy may not amount to
less than three months due to renovation and refurbishment that may be required within the rental area.
Please refer to the individual property templates in Appendix 1 for further information.
Tenant Improvements
For initial letting as well as for re-letting, we assumed tenant improvements (TI’s). Tenant improvements are costs
for fixtures and building works incurred when a new rental contract is signed. In the valuation, these costs were
fixed for each individual rental area according to the exterior and interior appearance. We considered tenant
improvement costs between € 25/m² and € 100/m². We consider our assumptions to be appropriate for current
market terms.
For the new rented retail unit of KiK (200 m²) in Vilshofen, we have considered TI’s of € 350/m² due to the fact
that the unit was in shell condition. These costs are assumed by the landlord in the process of contractual
negotiations.
Please refer to the individual property templates in Appendix 1 for further information.
Agent’s Fees
Letting fees usually include agent’s fees borne by the owner and are incorporated into the estimated cash flow.
For the Matrix Portfolio we assumed three monthly rental payments for commercial units.
Contractual Terms
Rental terms are estimated by drawing upon standard rental contracts, giving consideration to building use and
the current real estate market. A contractual period of 10 years is assumed for large units and 5 years for smaller
units. Contract extension options in the new lease contracts are disregarded. The rent for new lease contracts
reflects the market rent for the building. The contractual rent used in the calculation of future cash flows is shown
in the individual valuation templates in the Appendix 1 of this report.
Investment Yields
The yields applied reflect the individual location quality (macro- and micro-location) of the properties, building
structure, letting situation, covenant strength and the relationship between contractual and market rent. In the
current investment market, covenant strength and lease term play a major role in the purchase of such properties.
The cap and discount rates used for each property to calculate Market Value are disclosed in the individual
valuation reports.
Rental Growth Forecasts
For rents we assume a rental growth in line with the development of the inflation.
Table 7: Inflation forecast Germany
Year
Inflation
2014
1.6%
2015
1.8%
2016
1.8%
2017
1.6%
2018
1.6%
2019
1.6%
2020
1.6%
2021
1.6%
2022
1.5%
2023
1.5%
after 2023
1.5%
Source: Global Insight 2013
23
4.3
Valuation Results
Market Value
The valuation is carried out on the basis of Market Value as defined in the ‘Royal Institution of Chartered
Surveyors' (RICS) Appraisal and Valuation Manual. This is incorporated into the Jones Lang LaSalle “General
Principles for Valuations and Standard Terms of Business”, which is attached as Appendix 2.
The “Market Value” is an appraisal of the price for which a property transaction would take place on the appointed
valuation date and may be defined as:
We are of the opinion that the Market Value of the subject portfolio is as at 31 December 2013:
€ 176,100,000 (net)
(ONE HUNDRED SEVENTY-SIX MILLION, ONE HUNDRED THOUSAND EUROS)
reflecting € 1,197 /m² of lettable area
The above valuation figure represents a net figure, i.e. a deduction has been made for land transfer tax and legal
costs and agent’s fees normally incurred by the purchaser. No allowance has been made for any expenses of
realisation or for taxation, which might arise in the event of a disposal. The properties are considered as if free
and clear of all mortgages or other charges, which may be secured thereon.
24
4.4
Sensitivity Matrix
Below we present a matrix per property showing the Market Value sensitivity to changes of the Discount Rate.
4.4.1 Aschersleben
- 50 bp
€ 20,700,000
Sensitivity Matrix as at 31 December 2013
Discount Rate Variation
- 25 bp
7.65%
+ 25 bp
€ 20,400,000
€ 20,000,000
€ 19,700,000
+ 50 bp
€ 19,400,000
- 25 bp
7.05%
+ 25 bp
€ 16,800,000
€ 16,500,000
€ 16,200,000
+ 50 bp
€ 15,900,000
- 25 bp
7.50%
+ 25 bp
€ 8,300,000
€ 8,100,000
€ 8,000,000
+ 50 bp
€ 7,800,000
- 25 bp
7.10%
+ 25 bp
€ 16,100,000
€ 15,800,000
€ 15,500,000
+ 50 bp
€ 15,300,000
- 25 bp
7.15%
+ 25 bp
€ 15,000,000
€ 14,800,000
€ 14,500,000
+ 50 bp
€ 14,300,000
- 25 bp
7.00%
+ 25 bp
€ 12,900,000
€ 12,700,000
€ 12,400,000
+ 50 bp
€ 12,200,000
4.4.2 Augsburg
- 50 bp
€ 17,100,000
4.4.3 Bad Aibling
- 50 bp
€ 8,400,000
4.4.4 Biberach
- 50 bp
€ 16,300,000
4.4.5 Borken
- 50 bp
€ 15,300,000
4.4.6 Erlangen
- 50 bp
€ 13,100,000
25
4.4.7 Geislingen
- 50 bp
€ 9,300,000
- 25 bp
7.45%
+ 25 bp
€ 9,200,000
€ 9,000,000
€ 8,800,000
+ 50 bp
€ 8,700,000
- 25 bp
7.25%
+ 25 bp
€ 15,800,000
€ 15,600,000
€ 15,300,000
+ 50 bp
€ 15,100,000
- 25 bp
6.50%
+ 25 bp
€ 13,900,000
€ 13,600,000
€ 13,400,000
+ 50 bp
€ 13,100,000
- 25 bp
7.10%
+ 25 bp
€ 15,000,000
€ 14,700,000
€ 14,500,000
+ 50 bp
€ 14,200,000
- 25 bp
7.50%
+ 25 bp
€ 17,000,000
€ 16,800,000
€ 16,500,000
+ 50 bp
€ 16,200,000
- 25 bp
6.75%
+ 25 bp
€ 11,300,000
€ 11,100,000
€ 10,900,000
+ 50 bp
€ 10,700,000
- 25 bp
7.50%
+ 25 bp
€ 7,600,000
€ 7,400,000
€ 7,300,000
+ 50 bp
€ 7,200,000
4.4.8 Glauchau
- 50 bp
€ 16,100,000
4.4.9 Ludwigsburg
- 50 bp
€ 14,100,000
4.4.10 Ludwigsfelde
- 50 bp
€ 15,200,000
4.4.11 Neckarsulm
- 50 bp
€ 17,300,000
4.4.12 Vilshofen
- 50 bp
€ 11,500,000
4.4.13 Wittenburg
- 50 bp
€ 7,700,000
26
4.5
Market Value Disclaimer
Our valuations are carried out on the basis of market value as defined in the ‘Royal Institution of Chartered
Surveyors' (RICS) Appraisal and Valuation Manual. The “Market Value” according to the RICS Appraisal and
Valuation manual contains an appraisal of the price at which a property transaction would take place at the
appointed valuation date and may be defined as: “The estimated amount for which an asset or liability should
exchange on the valuation date between a willing buyer and a willing seller in an arm's-length transaction after
proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.”
According to information given by Brack Capital Properties N.V., we understand that the Matrix portfolio was
offered in a distressed loan situation. Thus, the subject transaction can be considered a forced sale, so that the
underlying purchase price (of whom we are not aware of) is not necessarily comparable to the above-mentioned
market value definition. Furthermore, our valuation is based on market parameters, in particular concerning
service charges, which potentially deviate from the actual situation of the portfolio on the purchase date.
After discussions with Brack Capital Properties N.V. we now understand that the purchase price is lower than the
estimated market value. However, we are not in the position to comment on this deviance as we are not aware of
the exact conditions of the final purchase contract, nor of any side letters or supplementary agreements that
potentially deviate from the valuation basis. We assume that the distressed vendor might have accepted Brack
Capital Properties N.V.’s lower bid in order to quickly close a deal with a trusted, recognised purchaser with a
proven track record. In this regard, our calculated market value could be above the agreed purchase price;
nonetheless, we are comfortable with this level and consider it to reflect the market value (according to the above
RICS definition) for the portfolio at the respective valuation date.
Prior to this valuation round, we have conducted a valuation in March 2013 for the financial statements of Brack
Capital Properties N.V. Compared to the previous valuation in March 2013, the market value of the portfolio in
December 2013 has decreased by approx. 0.4%.
This is mainly due to the increased vacancy rate of 19% in Augsburg, to the shortened lease contract of Kaufland
by 5 years to 2022 and to the fact that the surplus land of the parcel 3002/1 of the Biberach property had been
sold. For further details please refer to the individual property reports.
Please find below the results (Market Values) of our prior valuation:
No.
Property
03/2013
12/2013
1
Aschersleben
20,000,000 €
20,000,000 €
2
Augsburg
17,100,000 €
16,500,000 €
3
Bad Aibling
8,500,000 €
8,100,000 €
4
Biberach
16,200,000 €
15,800,000 €
5
Borken
15,000,000 €
14,800,000 €
6
Erlangen
12,700,000 €
12,700,000 €
7
Geislingen
9,100,000 €
9,000,000 €
8
Glauchau
16,300,000 €
15,600,000 €
9
Ludwigsburg
12,700,000 €
13,600,000 €
10
Ludwigsfelde
14,200,000 €
14,700,000 €
11
Neckarsulm
17,200,000 €
16,800,000 €
12
Vilshofen
10,100,000 €
11,100,000 €
13
Wittenberge
7,700,000 €
7,400,000 €
176,800,000 €
176,100,000 €
Total
27
5 Confidentiality & Publication
In preparing this valuation report, we have relied upon information provided by you and your representatives
relating to tenure, tenancies, building and site areas, and building description. If this information proves to be
incorrect or additional information is made available to us, the accuracy of the valuation could be affected. In such
case, we reserve the right to amend our opinion of value accordingly.
In accordance with our standard practice, we must state that the content of this report, including the valuation,
has been prepared exclusively for Brack Capital Properties N.V. (BCP) for the purposes of assisting BCP to value
its assets as at 31 December 2013 for its financial statement reporting and for no other purpose.
In addition, the results of the work executed by Jones Lang LaSalle shall remain confidential and are intended
exclusively for BCP and only for the purposes specified in the contract. Any other use and, in particular,
disclosure to third parties or other publications (disclosure to third parties) – including extracts – without the
express prior written consent of Jones Lang shall be prohibited. We consent to the disclosure of the valuation
report to a third party only within the scope of the publication of the financial statement reporting. However, BCP
agrees to notify the respective third parties in writing and to underline that Jones Lang LaSalle generally assumes
no liability towards third parties for the work and services provided and that third parties may make no claims
whatsoever against Jones Lang LaSalle on the basis of the work and services provided. BCP also agrees to
indemnify Jones Lang LaSalle against any third party claims and associated costs asserted by third parties
against Jones Lang LaSalle as a result of unauthorized disclosure or publication of the results of the work and
services provided.
Jones Lang LaSalle GmbH’s liability for any loss or damage caused by negligence on our part, irrespective of the
legal reason, in relation to the valuation services provided is limited to a maximum of 10% of the respective and
reported Market Value per property, and may not exceed a maximum liability cap of € 7.5 million (euros) for any
case.
Finally, to the fullest extent permitted by law, we do not accept or assume responsibility or liability in respect of
the whole or any part of the report or valuation for any other purpose than stated above nor to any other person or
entity to whom the report or valuation is shown or disclosed or into whose hands it may come, whether published
with our consent or otherwise, except where expressly agreed by our prior consent in writing.
ppa. Andrew M. Groom MRICS
International Director
Head of Valuation & Transaction Advisory
Frank Rambow MRICS
National Director
Valuation & Transaction Advisory
Norbert Schultek
Senior Consultant
Valuation & Transaction Advisory
Appendix
28
Appendix I – Property Reports
Appendix I – Property Reports
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Brack Capital Properties N.V.
Property address
Property no.
1
Property Summary
Key Figures
Property type
Main tenant
Retail Park
toom Baumarkt Vermietungs GmbH & Co. KG (Marktkauf)
Total lettable area
Total parking units
14,522 m²
700 units
Current vacancy rate
Weighted average lease term
8.8%
7.9 years
1993
n.a.
Year of construction
Year of refurbishment
Contractual gross rental income (month 1 x 12)
total p.a.
per m² / month
€ 1,520,129
€ 8.72
Total non-recoverable expenses (month 1 x 12)
total p.a.
per m² / month
€ 122,157
€ 0.70
Net operating income (month 1 x 12)
total p.a.
per m² / month
€ 1,397,972
€ 8.02
total p.a.
€ 1,595,689
4.5%
Market rental value
Over-/Underrent based on occupied areas
SWOT Analysis
Strengths
Weaknesses
Sufficient parking areas on site
Good accessibility by car
Risk diversification due to multi-tenant structure (good tenant mix)
Synergies due to adjacent furniture store
Located on a main road, in a special zone
Located on the outskirts of Aschersleben
Slight under-rent of Kaufland premises
Difficulty to let former Quelle unit due to its location within the property
Low purchasing power and centrality index
0
Opportunities
Threats
Prolongation of lease contracts after expiry
Reletting of the former areas of dm and Quelle
0
0
0
Re-letting or prolongation of existing contracts may result in worse conditions
Significant negative population growth
Below-average purchasing power
Limited investor focus on properties in eastern Germany
0
Property Rating (1 = very negative, 5 = very positive)
Building
Location
Building age
Lettable Area
Property condition
General impression
2
4
2
2
16 to 25 years
Between 12,500 and 15,000 m²
Below average building condition
Below average general impression
Macrolocation
Microlocation
Commercial activity
Competition
4 WALT seven to ten years
3 Rack rented (-5% to 5%)
4 Tenants with very good credit rating
Investment market
Investment volume
Saleability
Liquidity
2
3
4
3
Below average location and catchment area
Average micro location
Average commercial activity nearby
Average competition level
Investment Quality
WALT
Over- / underrent
Quality of tenants
2 Under developed property market
4 Good lot size
4 Good saleability within 6 months
Property Description
The site encompasses the subject retail park, a petrol station as well as some food stalls located in front of the main entrance. The property was constructed in 1993 and contains a self-service department store
(Kaufland) and a DIY discount store (B1) as large-scale retail units as well as some mid-sized and small-sized retail units. The building has a rectangular shape and for the most part is a single storey structure, with
a small second storey located over the main entrance area in the south serving as an administrative area.
The property is constructed of concrete columns, precast concrete beams and concrete floor slabs. The flat roof has trapezoid metal panels as bearing structure and several skylights integrated. The facade is made
from multilayer concrete panels. Main entrance, office windows and shop displays have coated aluminium frames and the entrance is equipped with automatic sliding doors.
The walls within the public areas are plastered and painted. The ceiling inside the mall is suspended with a grid system still allowing the technical installations above to be seen. The smaller shop units usually have
a suspended ceiling while the large retail units of B1 and Kaufland do not have a suspended ceiling with all technical installations viewable.
The floor is mainly covered with ceramic tiles, while the fit out of the smaller shop units depends on the tenant’s preferences. In terms of HVAC, the property does not offer air conditioning, only oil-fueled heating and
ventilation. The parking area is made of asphalt on driveways and paving stones in the parking areas.
Valuation Results
Market Value
€ 20,000,000
equals to
Market Rental Value
€ 1,377 per m²
€ 1,595,689 p.a.
Discount Rate
7.65%
Net Initial Yield
6.56%
Capitalisation Rate
7.10%
Net Reversionary Yield
6.91%
This report is only to be read in conjunction
with the valuation report provided.
excluding
capital
expenditures
Page 1 of 12
€ 9.16 / m² / p.m.
equals to
6.56%
Multiplier (initial)
13.16
6.91%
Multiplier (based on MRV)
12.53
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Location
Germany
Macroeconomic Indicators
(Source: GfK, BBE, BBSR/Inkar 2012/2013)
Saxony-Anhalt
Salzlandkreis (Rural District)
Aschersleben
06449
Federal State
District
City
Postcode
Population
Population
Population
Number of Households
Population Density
Population Density
Population Forecast (2009 - 2025)
Population Growth (2004 - 2009)
Unemployment Rate (12/2013)
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Purchasing Power Index
Retail Purchasing Power Index
Retail Centrality Index
Aschersleben
2,313,280
206,784
28,706
14,699
145
184
-20.0%
-5.5%
-7.6%
10.7%
12.7%
(Source: GfK and BBE 2012/2013)
District
City
Federal State
District
District
in m €
in m €
index
index
index
3,320
465
82.30
78.52
94.07
Macro Location
The city of Aschersleben is located in the federal state of Saxony-Anhalt. Aschersleben is situated
between the region of the Harz Mountains and the Magdeburger Boerde. Aschersleben is rich in many
cultural and leisure activities, and has a healthy small- and medium-sized business structure. There are
many historic churches and other buildings, which are worth visiting. The cultural activities of the town
are well known in the whole region and attract many visitors. The closest larger cities are Magdeburg,
(approx. 50 km to the north), Halle (Saale) (approx. 67 km to the south-west) and Braunschweig
(approx. 107 km to the north-west).
The transport connections from Aschersleben to the German motorway system as well as to the major
roads are quite good. Aschersleben is located close to the motorway A14. The main federal roads,
which run through Aschersleben are B6, B180 and B185.
There are also connections to the public transport network via the local bus system within the city and
the train, regional or national bus network for out-of-town travel. The train station of Aschersleben offers
service to Halle (Saale), Dessau and Magdeburg.
The closest international airports are located in Magdeburg (approx. 49 km) and Leipzig-Halle (approx.
80 km).
The economy traditionally has been based on the printing industry, machine tool building and vehicle
construction. Highly specialised machines and printing products have been produced in Aschersleben
since the 19th century. The production of non-woven cotton has been firmly established in Aschersleben
since the 1990s. Also medical equipment companies, which have established their operations in the city
in recent years, are economically important.
Micro Location
Micro Location
The property is located at Hoymer Chaussee, approx. 3 km west from Aschersleben's historic city centre
on the outskirts of the city by an arterial road, connecting to the major federal road (B6). The property
shares its parking lot with a furniture discount store to the east. To the south, there is the
aforementioned arterial road with plots on the other side of the road. Similarly, to the north of the
property more plots can be found. The land to the west of the property is used for agricultural purposes.
The property has its own bus stop on Hoymer Chaussee called "Aschersleben Kaufland", which
connects the premises with the remainder of Aschersleben including its train station.
The property offers good visibility and can be accessed directly from the arterial road by which it is
located. It benefits from the adjacent discount furniture store and the petrol station on its plot.
0
Local Tax Information
Real Estate Tax Rate (Typ B)
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
388
5.0
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Site Plan
Source: Cadastral plan on a 1 to 2,000 scale, dated 28.12.2010
Site Information
Site area
thereof surplus land
36,735 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
Surplus land value (net)
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
Building encumbrances
Yes
Comment
The site consists of two plots: 174 and 19/2. The site has an even topography and an irregular shape.
The site is not listed in the register of contaminated land ("Altlastenkataster").
There is an encumbrances registered on plot 19/2. However, since it containes an obligation in case a
property is built on the plot we assume that this obligation has been fulfilled by the owner. Furthermore,
there are a couple of easements registered on the plots. However, we do not regard these to have an
impact on the market value. For the purposes of this valuation, we have assumed that the subject
property is free of any soil or building contamination.
Town Planning
Use class
SO (special zone)
Site coverage ratio (GRZ)
n.a.
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority's website, a legally binding development plan
exists, entitled "Hoymer Chaussee Nr. 1" with the following regulations: the subject site is located in a
special retail zone (Sondergebiet Einkaufszentrum). It sets the following restrictions, among others: a
maximum of 16,600 m² of retail space is permissible, of which non-food retail space is not permitted to
exceed 4,300 m² and DIY may not exceed 3,600 m² (we assume that an additional agreement is in
place for B1 to operate a larger scheme).
Tenure
Land Register
Owner
TPL Aschersleben
Local Court of
S.á.r.l., Luxembourg
Achersleben, land
register of Aschersleben
Sheet
8878
Plot
19
Parcel
19/2
174
Section 2 (Restrictions)
Section 3 (Loans)
Several limited personal easements and personal Land charges in the total amount of € 105,000,000 in
easements: right-of-way and parking for the
favour of Corealcredit Bank AG, Frankfurt am Main;
respective owner of the parcels 171, 172 and 173 entered on 26.05.2011
(plot 19); the right to freshwater, wastewater,
energy and water for firefighting for the respective
owner of the parcels; respective owner of the plot
registered on sheet 8879 no. 1, 2, 3 prohibited to
operate furniture stores, casinos, sex-shops,
peep-shows, etc.; right to operate a self-service
department store including essential adjacent
areas, parking areas, etc. for Kaufland
Dienstleistungs GmbH & Co. KG, Neckarsulm;
the right to build, operate and maintain a
transformer station with cable, equipment, service
and information lines for Stadtwerke
Aschersleben GmbH.
Source: Land register extract, dated 14 January 2014
Page 3 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Competitor Map
Source: Jones Lang LaSalle Research
Competitor Overview
Name
E-center
0
0
Type
Hypermarket
0
Address
06449 Aschersleben, Geschwister-Scholl-Str.
Sales area
3,585 m²
m²
m²
Distance
1.20 km
Potential
Medium
0
0
0
0
0
0
0
0
0
0
0
Competiton Indicators
Inhabitants in primary catchment area (Radius 5 km)
24,188
Purchasing power in Mio. € (District)
Inhabitants in secondary catchment area (Radius 10 km)
20,957
Purchasing power per Capita in € (Radius 5 km)
16,191
Number of households (Radius 5 km)
12,361
Unemployment Rate (District)
12.7%
10,619
Population forecast for the district (2009 - 2025)
Retail Purchasing Power Index (District)
78.52
Retail Centrality Index (District)
Page 4 of 12
3,320
-20.0%
94.07
abc
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
1
Main competitors
This retail park is located close to the city centre of Aschersleben and comprises an E-Center
(Edeka), medimax (consumer electronics), and a Zoo & Co (pet shop) as well as some smaller
tenants such as a bakery. Furthermore, a discounter is located in the vicinity. This competitor is
approx. 1.8 km away from the subject property.
This competitor is a Hellweg DIY store at the other end of town, next to toom DIY. The Hellweg DIY store
is larger than B1 in the subject property and comprises a garden centre as opposed to the B1. Due to
the different market positioning of Hellweg and B1, these two are not direct competitors. The Hellweg is
approx. 3.2 km away from the subject property.
Competition Comment
Concerning food competitors, the aforementioned E-Center as the only larger scale food retailing scheme and some smaller supermarkets. Nevertheless, Kaufland has by far the largest sales area, so that at least
supermarkets can be considered to be only indirect competitors. Kaufland offers a very deep and broad product range with more than 50,000 products, while discounters and supermarkets offer a limited product
range with only 7,000 to 11,000 (supermarkets) or 400-2,500 (discounters) articles. Therefore, these retailing forms address different customers or customer needs. While supermarkets and discounters cater to the
daily needs of customers, Kaufland offers a larger variety for products that are bought on a non-daily basis.
Based on this, the primary and secondary catchment area of the Kaufland is sufficient to operate successfully in this location.
The strongest competitor for Kaufland is the small retail park anchored by E-Center located at Seegraben 5 close to the city centre. The E-Center is somewhat smaller than the Kaufland, has a significantly lower
share of non-food items and focuses on a good presentation of the goods sold. Thus, Edeka-branded stores are usually perceived as quality-focused rather than cut-price focused as Kaufland usually is.
Additionally, the tenant mix in the retail park with consumer electronics and a pet shop differs from the subject property; thus, we do not see direct competition. Hence, we assess the competition level to be medium.
In terms of DIY competition, there are two other DIY stores in Aschersleben. These two are located next to each other at an arterial road in the north-eastern outskirts of the city. Among these two, Hellweg is clearly
in the better position in terms of visibility, accessibility, as well as size. In terms of level of competition, the catchment area, for the most part shared by two competitors, is quite small. However, toom as well as
Hellweg target customers not driven solely by price but rather by quality of goods and customer service. This is quite contrary to the discount strategy used by B1. Therefore, we assess the level of competition to be
moderate.
Turnover analysis
The rents in functional retail agglomeration are linked to turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate
normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² up to more than € 10,000/m².
Taking into consideration the tenant mix in the subject property, the space productivity should be in the range of € 2,250 and € 6,000/m². Generally most tenants have a below average space productivity, i.e.
turnover, compared to similar retail parks. For Kaufland, we have also been provided with turnover figures. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range.
With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store. Hence, we believe that a higher market rent is achievable after the end of the
lease contract. Please also refer to the rent/turnover analysis on page 8.
We have not been provided with turnover figures of B1. The rent of B1 would result in a productivity of approx. € 1,800/m². However, toom (incl. B1) has an average productivity of only € 1,000/m². Additionally, the
lease comparable for DIY in Aschersleben indicate that the market rent and turnover expectations of DIY tenants are lower than € 1,800/m². Thus, we reduced the market rent accordingly. Nevertheless, apart from
B1, the lower turnover is already reflected in below average contractual rents and in the market rents used in the valuation. Thus, we assess the rents paid all in all to be sustainable on the current level.
Conclusion
The subject property is a retail park located in the outskirts of Aschersleben at an arterial road. It offers good visibility and accessibility by car. The property is anchored by a B1 DIY discount store and a Kaufland selfservice department store. Additionally, smaller units are let to Deichmann, AWG, among others. Furthermore, a petrol station advertising low petrol prices is situated on site as well.
The retail park predominantly focuses on price-conscious customers with a discount DIY store and Kaufland with plenty of non-food bargains and a wide range of own brand food products. Tenants such as AWG
and Deichmann fit into this strategy; thus, the tenant mix within the subject property is assessed to be good. Moreover, a discount furniture store shares the parking area with the subject property, which is a
combination fitting combination. Therefore, it is likely that the retail park is able to attract a number of customers who usually would not be in this catchment area. Due to this positioning of the property in the market,
the level of competition is assessed to be only medium though there is a better located smaller retail park in Aschersleben's city centre.
The tenants within the property, apart from the food stands, suffer from below-average turnover, likely because of the low purchasing power in the region. Nevertheless, based on the turnover data made available
to us, we believe that the total rental income is sustainable. The smaller tenants benefit from the fact that all customers of Kaufland pass by their premises with the exception of one shop unit. The vacancy rate
within the property is low (8.8%) with only three units being unoccupied. The unoccupied unit is not part of the mall, but has a separate entrance close to the main entrance. Nonetheless, the entrance situation is
quite problematic not catching the attention of customers. Therefore, we believe this unit to be difficult to let.
The average rent paid is € 8.72/m²/month and the weighted average lease term is 7.9 years. The non-recoverable costs of the property are above average due to the fact that Kaufland agreed in its lease to not pay
for costs such as ground tax, insurance fees or management costs.
All in all, the property offers an attractive tenant mix with regards to the economic situation of the region with two strong anchor tenants.
Page 5 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Kaufland Warenhandel Brandenburg GmbH & Co. KG
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
5,533
€ 30,296
5.48
Yes
01.10.2007
30.09.2026
2 Allg. Warenvertriebs GmbH
Retail
Let
1,345
€ 15,000
11.16
Yes
01.03.2002
28.02.2022
75%
PM
3 BRL Center GmbH
Retail
Let
151
€ 4,179
27.68
Yes
01.08.2008
31.07.2028
75%
75%
GT I PM
4 BRL Center GmbH
GT I PM
Storage
Let
4
€ 177
42.03
Yes
01.08.2013
31.07.2028
0%
5 Metzgerei Carsten Kneusel
Retail
Let
124
€ 6,604
53.26
Yes
01.10.2004
30.09.2016
75%
GT I PM
Other Units
Let
2
€ 700
350.00
01.01.2011
28.02.2017
75%
M GT I PM
Retail
Let
70
€ 1,540
22.00
Yes
01.09.2007
31.08.2017
75%
GT I PM
Retail
Let
73
€ 5,510
75.48
Yes
01.09.2007
31.08.2019
75%
GT I PM
9 Hang Bui
Other Units
Let
8
€ 1,000
125.00
Yes
01.01.1996
31.03.2015
75%
PM
10 Thurländer Hähnchen Grill GmbH
Other Units
Let
8
€ 938
117.19
Yes
01.12.2002
31.12.2015
75%
PM
11 Blochwitz
Other Units
Let
8
€ 680
85.00
Yes
01.04.2006
31.03.2015
75%
PM
Retail
Let
313
€ 3,253
10.38
Yes
15.09.2010
31.08.2014
75%
GT I PM
62
€ 1,419
22.92
7 Lucas, Dagmar
8 Ihr Bäcker GmbH & Co. KG
12 NKD Vertriebs GmbH
13 Reiseland GmbH & Co. KG
Retail
Let
Yes
09.08.1993
30.09.2017
75%
GT I PM
14 Vacant
Retail
Vacant
54
€0
0.00
15 Frisör Klier GmbH
Retail
Let
72
€ 2,335
32.42
Yes
04.08.1993
28.02.2018
75%
GT I PM
16 Convenience Concept GmbH
Retail
Let
40
€ 1,346
33.64
Yes
01.09.2007
31.08.2024
75%
GT I PM
17 Marktkauf Autonom BM Vermietungs GmbH & Co. KG
Retail
Let
4,880
€ 38,399
7.87
Yes
01.07.1999
30.06.2019
75%
18 Vacant
Retail
Vacant
478
€0
0.00
Retail
€ 9,353
19 Deichmann SE
GT I
Let
443
21.10
Yes
02.08.1993
31.10.2024
75%
GT I PM
Storage
Let
129
€0
0.00
Yes
01.03.2002
28.02.2022
75%
PM
21 KSK Aschersleben-Straßfurt
Other Units
Let
1
€ 273
273.18
Yes
01.09.1993
31.03.2015
75%
22 Schwarz Außenwerbung GmbH
Other Units
Let
1
€ 433
433.33
Yes
01.01.2010
31.12.2015
75%
Other Units
Let
1
€ 424
424.00
Yes
01.07.1999
30.06.2019
75%
PM
Yes
24 TOTAL Deutschland GmbH
Petrol Station
Let
1,200
€ 1,570
1.31
01.04.2003
31.03.2018
75%
M GT I PM
25 Warenautomaten H. Bögershausen
Other Units
Let
1
€ 10
10.00
01.06.2007
31.03.2015
75%
M GT I PM
26 Aaldering
Other Units
Let
1
€ 333
333.33
01.01.2010
31.03.2015
75%
M GT I PM
Retail
Vacant
750
€0
0.00
28 Kurzzeitmieter
Other Units
Let
1
€ 866
866.00
01.10.2007
30.09.2026
100%
29 Mall Income
Other Units
Let
1
€ 39
39.25
00.01.1900
30.09.2026
0%
External parking
Let
700
€0
0.00
00.01.1900
30.09.2026
0%
15,722 m²
€ 126,677
27 Vacant
30 Parking
Total
Yes
No
0%
* M = Maintenance, GT = Ground Tax, I = Insurance Costs, PM = Property Management
Page 6 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Area Category
Area
sqm/unit
Retail
5,533
€ 6.50
€ 35,967
€ 50
0
6
Retail
1,345
€ 10.00
€ 13,446
€ 50
0
15
3 BRL Center GmbH
Retail
151
€ 30.00
€ 4,530
€ 100
0
6
4 BRL Center GmbH
Storage
4
€ 30.00
€ 126
€ 100
0
6
Retail
124
€ 65.00
€ 8,060
€ 100
0
Other Units
2
€ 125.00
€ 250
€0
0
7 Lucas, Dagmar
Retail
70
€ 17.50
€ 1,225
€ 100
8 Ihr Bäcker GmbH & Co. KG
Retail
73
€ 65.00
€ 4,745
€ 100
9 Hang Bui
Other Units
8
€ 125.00
€ 1,000
€0
10 Thurländer Hähnchen Grill GmbH
Other Units
8
€ 125.00
€ 1,000
11 Blochwitz
Other Units
8
€ 100.00
€ 800
12 NKD Vertriebs GmbH
Retail
313
€ 10.00
Tenant Name
Market
Rent
Agency
Fees*
Lease
Term**
Renewal
Probability
0
3
10
75%
0
3
5
75%
0
3
5
75%
0
3
5
75%
6
0
3
5
75%
6
0
3
5
75%
0
9
0
3
5
0
6
0
3
5
75%
0
6
0
3
5
75%
€0
0
6
0
3
5
75%
€0
0
6
0
3
5
75%
€ 3,133
€ 100
0
12
0
3
5
75%
5
75%
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
9
Rent
Abatem.*
0
3
75%
Retail
62
€ 20.00
€ 1,238
€ 100
0
14 Vacant
Retail
54
€ 22.50
€ 1,224
€ 100
9
9
0
3
5
0%
Retail
72
€ 30.00
€ 2,160
€ 100
0
9
0
3
5
75%
Retail
40
€ 30.00
€ 1,200
€ 100
0
9
0
3
5
75%
Retail
4,880
€ 6.50
€ 31,720
€ 50
0
6
0
3
10
75%
12
15
3
5
18 Vacant
19 Deichmann SE
21 KSK Aschersleben-Straßfurt
Retail
478
€ 11.00
€ 5,258
€ 100
Retail
443
€ 15.00
€ 6,650
€ 100
0
15
0
3
5
75%
Storage
129
€ 8.00
€ 1,032
€ 100
0
15
0
3
5
75%
Other Units
1
€ 250.00
€ 250
€0
0
3
0
3
5
100%
Other Units
1
€ 450.00
€ 450
€0
0
0
0
3
5
75%
Other Units
1
€ 400.00
€ 400
€0
0
0
0
3
5
75%
Petrol Station
1,200
€ 1.54
€ 1,850
3
10
100%
25 Warenautomaten H. Bögershausen
Other Units
1
€ 10.00
€ 10
€0
0
0
0
3
5
75%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
75%
Retail
750
€ 7.00
€ 5,250
€ 100
15
15
0
3
5
0%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
10
75%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
10
75%
External parking
700
€ 0.00
€0
€0
0
0
0
0
0
75%
28 Kurzzeitmieter
29 Mall Income
30 Parking
Total
* months
15,722 sqm
** years
0
0
0
0%
26 Aaldering
27 Vacant
€0
0
€ 132,974
***structural vacancy
Page 7 of 12
.
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
14,389
0
0
0
0
133
14,522
1,200
33
0
700
1,933
Area Vacant
m²
0
1,282
0
0
0
0
0
1,282
0
0
0
0
0
Area Let
m²
0
13,107
0
0
0
0
133
13,240
1,200
33
0
700
700
Vacancy Rate
%
0.00%
8.91%
0.00%
0.00%
0.00%
0.00%
0.00%
8.83%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
9.10
0.00
0.00
0.00
0.00
1.33
1.31
172.63
9.57
0.00
0.00
Contractual
Rent
€/month
0
119,234
0
0
0
0
177
1,570
5,697
126,677
0
0
Contractual
Rent
€/year
0
1,430,811
0
0
0
0
2,118
18,840
68,360
1,520,129
0
0
Potential
Rent
€/year
0
1,565,360
0
0
0
0
2,118
18,840
68,360
1,654,677
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
8.74
0.00
0.00
0.00
0.00
8.69
1.54
126.06
9.16
0.00
0.00
Market
Rent
€/year
0
1,509,674
0
0
0
0
13,896
22,200
49,920
1,595,689
0
0
Market
Rent
€/month
0
125,806
0
0
0
0
1,158
1,850
4,160
132,974
0
0
Over-/ UnderRented
0.0%
4.0%
0.0%
0.0%
0.0%
0.0%
-84.8%
-15.1%
36.9%
4.5%
0.0%
0.0%
Assessment of Kaufland market rent
Turnover to rent ratio
Space productivity
7,000
12.00
6,500
11.00
Explanation
Usual market % - levels
11.08
Market rent
10.00
6,000
Contractual Rent
9.00
Rent / m² / month
5,500
5,000
4,500
Rents
8.31
8.00
7.00
6.50
6.00
5.54
5.48
5.00
4,000
2.0%
5.48
Market
2.3%
6.50
4% of turnover
11.08
3% of turnover
8.31
Turnover potential
4,015
2.00
1.0%
in € / m² p.a.
18,397,517 €
(net)
3.00
3,000
5.54
2% of turnover
4.00
3,500
€ / m²
%
Contractual
Sales Area
1.5%
2.0%
2.5%
based on sales area
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 4,582 m²
5,533 m²
Turnover-rent-ratio
Self-service department stores usually can afford to pay a rent in the range of 2% to 4% of their net turnover (economically sustainable rent burden) and have a space productivity of about € 4,000 to € 6,000 per m²
sales area. The two graphics above indicate, how the contract rent of the main tenant Kaufland as well as the assumed market rental level, can be assessed on the basis of usual market ranges. This analysis is
based on the turnover potential figures prepared by Trade Dimension.
D&B Rating of Main Tenant
Main tenant
Tenant name
Rent p.a.
Share of total income
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
toom Baumarkt Vermietungs GmbH & Co. KG (Marktkauf)
€ 363,558
24%
12.7 years
80
HH 2
2
52
€ 15,000
The main tenant toom baumarkt (Marktkauf Autonom BM Vermietungs GmbH & Co. KG) is a
corporation belonging ultimately to Rewe Group, which purchased Marktkauf in 2007. Marktkauf
operates self-service department stores and used to operate DIY stores until 2007, when they sold off
about 133 stores to Rewe (toom DIY) and closed the remaining ones. The Rewe Group is a large
German supermarket corporation, currently holding a market share of 15.7% in food retailing. According
to Dun & Bradstreet (D&B) Rating as of 28.01.2014 toom Baumarkt has a low credit risk. The risk of
insolvency (D&B Score) within the next 12 months compared with other German companies is assessed
to be quite low, i.e. 52% of businesses on the German database have the same or higher risk of failure.
In Sep. 2013 the company name changed to toom baumarkt Vermietungs GmbH & Co. KG.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
1
Market Value
Lease Contract Commentary
The main tenant, Marktkauf Autonom BM Vermietungs, has a lease expiring in 2019 with the option to prolong its lease by five years two times. The rent is indexed and will be adapted by 60% of the CPI change
whenever the change exceeds 10 percent in relation to CPI basis. The tenant does not contribute to costs concerning maintenance work for the roof and structure of the property. Furthermore, the tenant does not
pay for management costs. However, the share of ground tax and insurance fees are borne by the tenant. The second largest tenant, Kaufland, has a lease expiring in 2026 with the option to prolong its lease by
five years three times. The rent is indexed and will be adapted by 50% of the CPI change whenever the change exceeds 10 percent in relation to CPI basis. Kaufland does not contribute to any costs in association
with maintenance costs for roof and the building structure, ground tax, insurance fees, and management costs. The remaining tenants usually do not pay for maintenance costs for roof and building structure and
pay a fixed amount each month for management costs (usually around € 100). However, insurance fees and ground tax are paid by these tenants. The rent is mostly indexed with 100% adjustment of the rent
whenever the German CPI changes by 10% or more. The WALT amounts to 7.9 years.
There have been some changes in the tenancy schedule. The tenant BRL Center GmbH extended the lettable area (4.2 m²). The following tenants have prolonged their lease contracts: Reiseland GmbH & Co. KG
(09/2017), Convenience Concept GmbH (08/2024), Deichmann SE (10/2024) and Ihr Bäcker GmbH & Co. KG (08/2019). The tenant Erdmann/ Focke with 54.4 m² extracted.
General Property Assumptions
Discount Rate Comment
Discount rate
7.65%
Capitalisation rate
7.10%
Capital expenditures*
The yields applied reflect the individual location quality (macro- and micro-location) of the properties,
building structure, letting situation, covenant strength and the relationship between contractual and
market rent. We derive the discount rate from market transactions. The discount rate reflects the rate of
return expected by investors and is determined based on the risk associated with a property. As
reinsurance, the initial yield profile is aligned with the market/other transactions. We have taken into
account such facts as the remaining lease term with the well-known anchor tenant, the tenant mix the
vacancy rate as well as the location within the federal state Saxony-Anhalt.
€0
Vacancy costs
€ 10.00 /m²/p.a.
* on the basis of cost estimates provided by Brack Capital Real Estate, dated April 2013
Breakdown of Non-Recoverable Costs
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
Other non-recoverable costs
Total non-recoverable expenses
** JLL analysis
Market
(assuming full occupancy)
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.57 /m²
€ 1.01 /m²
€ 0.33 /m²
€ 0.00 /m²
€ 8.41 /m²
€ 79,872
€ 22,802
€ 14,621
€ 4,862
€0
€ 122,157
per year
per year
€ 5.50 /m²
€ 1.65 /m²
€ 1.01 /m²
€ 0.33 /m²
€ 0.00 /m²
€ 8.49 /m²
€ 79,872
€ 23,935
€ 14,621
€ 4,862
€0
€ 123,290
Inflation
% of Gross
Contract Rent
5.25%
1.50%
0.96%
0.32%
0.00%
8.04%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Market Rental Growth
Year
Rental Growth
% of Gross
Market Rent
5.01%
1.50%
0.92%
0.30%
0.00%
7.73%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Total Non-recoverable Costs
Maintanance
Costs
€ 79,945
€ 81,139
€ 82,573
€ 84,027
€ 85,398
€ 86,750
€ 88,137
€ 89,563
€ 90,981
€ 92,335
€ 93,685
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 22,525
€ 25,027
€ 25,317
€ 25,781
€ 26,158
€ 24,580
€ 24,749
€ 25,842
€ 24,735
€ 25,938
€ 25,926
Insurance
Costs
€ 4,867
€ 4,939
€ 5,027
€ 5,115
€ 5,199
€ 5,281
€ 5,365
€ 5,452
€ 5,539
€ 5,621
€ 5,703
Ground
Tax
€ 14,634
€ 14,853
€ 15,115
€ 15,382
€ 15,633
€ 15,880
€ 16,134
€ 16,395
€ 16,655
€ 16,902
€ 17,150
Other Nonrecoverable Costs
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 135,455
€ 127,855
€ 128,246
€ 130,537
€ 132,516
€ 141,567
€ 139,762
€ 137,252
€ 143,813
€ 141,120
€ 143,101
Vacancy
Costs
€ 13,484
€ 1,897
€ 214
€ 232
€ 128
€ 9,076
€ 5,377
€0
€ 5,903
€ 324
€ 637
% of Total
Gross Revenue
9.0%
7.7%
7.6%
7.6%
7.6%
8.6%
8.5%
8.0%
8.7%
8.2%
8.3%
Non-Recoverable Costs as a percentage of Total Gross Revenue
10.0%
9.0%
8.6%
9.0%
8.0%
7.7%
7.6%
7.6%
7.6%
8.7%
8.5%
8.0%
8.2%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,649,262
€ 1,688,172
€ 1,706,804
€ 1,724,495
€ 1,748,537
€ 1,721,390
€ 1,710,852
€ 1,725,051
€ 1,735,671
€ 1,738,510
€ 1,746,237
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 147,594
-€ 19,681
-€ 18,994
-€ 5,783
-€ 4,640
-€ 82,718
-€ 60,938
-€ 2,253
-€ 86,697
-€ 9,308
-€ 17,847
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,501,668
€ 1,668,491
€ 1,687,810
€ 1,718,712
€ 1,743,897
€ 1,638,672
€ 1,649,914
€ 1,722,798
€ 1,648,974
€ 1,729,202
€ 1,728,390
Nonrecoverable
Costs
-€ 135,455
-€ 127,855
-€ 128,246
-€ 130,537
-€ 132,516
-€ 141,567
-€ 139,762
-€ 137,252
-€ 143,813
-€ 141,120
-€ 143,101
Net
Operating
Income
€ 1,366,213
€ 1,540,636
€ 1,559,564
€ 1,588,175
€ 1,611,381
€ 1,497,105
€ 1,510,152
€ 1,585,546
€ 1,505,161
€ 1,588,082
€ 1,585,289
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 5,440
-€ 3,715
€ 1,357,058
-€ 130,640
-€ 35,862
€ 1,374,134
€0
-€ 779
€ 1,558,785
€ 1,575,582
-€ 5,054
-€ 7,539
-€ 3,558
€ 1,605,087
-€ 2,736
-€ 31,082
-€ 69,803
€ 1,396,220
-€ 12,870
€ 1,454,707
-€ 42,575
€ 1,584,699
€0
-€ 847
-€ 19,594
-€ 26,384
€ 1,459,183
-€ 5,901
-€ 4,028
€ 1,578,153
€ 22,559,303
-€ 1,070
-€ 1,174
Total Cashflow (incl. Terminal Value @ 7.10 %)
Gross Value of Surplus Land
Gross Capital Value incl. Surplus Land
Present
Value @
7.65%
€ 1,312,393
€ 1,230,079
€ 1,301,034
€ 1,221,096
€ 1,155,659
€ 936,654
€ 903,081
€ 914,571
€ 781,972
€ 785,910
€ 10,794,073
€ 21,336,522
€0
€ 21,336,522
Total Gross Revenue versus Net Operating Income
€ 2000000.0
7.2%
€ 1800000.0
7.3%
7.4%
8.0%
7.6%
7.4%
7.4%
7.1%
7.0%
7.1%
6.4%
7.0%
€ 1600000.0
6.0%
5.0%
€ 1200000.0
4.0%
€ 1000000.0
€ 800000.0
Running yield
Rental income
€ 1400000.0
3.0%
€ 600000.0
2.0%
€ 400000.0
1.0%
€ 200000.0
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
Gross Capital Value (rounded)
total p.a.
per m²/month
€ 1,520,129
€ 8.72
Market rental value
total p.a.
per m²/month
€ 1,595,689
€ 9.16
4.48%
Over-/Underrent
Year 8
Total
€ 21,300,000
per m²
€ 1,467
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
6.56%
6.91%
Gross Initial Yield
Gross Reversionary Yield
7.60%
7.98%
Market Value (rounded)
Total
€ 20,000,000
per m²
€ 1,377
Valuation Comment
For our risk evaluation, we primarily considered the covenant strength as well as the lease duration of the existing contracts. The main tenant, Marktkauf Autonom BM Vermietungs GmbH, has good covenant
strength and is a subsidiary of Edeka Group. However, the premises are occupied by a subsidiary of REWE (B1). It could not be clearified whether the premises are sublet with consent of the landlord or were taken
over by REWE. For the purpose of this valuation, we assumed that the lease with Marktkauf is still in place and was sublet to REWE with consent of the landlord. We consider the covenant strength all in all to be
adequate to ensure the income stream at least until the lease expiry in 2019. The same applies for the tenant Kaufland, which has very good covenant strength; thus, we consider the cash flow until lease expiry in
2026 to be secured. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building age, third-party usability, competition situation and location.
For the purpose of the valuation on 31 December 2013, the non-recoverable costs (e.g. insurance costs as well as ground tax) remained unchanged and have been applied according to information received during
the previous valuation cycle. Management costs and maintenance costs have been applied according to internal benchmarks. We have not been provided with updated information regarding necessary capital
expenditures (CapEx). According to information received no CapEx are required. For the purpose of our valuation we have assumed that all capital expenditures for repairs in the first year as well as in the periods
of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 5.50/m² per annum as sinking fund. In terms of the market rent of Kaufland, our analysis shows that Kaufland could afford
to pay a higher rent of approx. € 6.90/m²/month. However, we took the highly negative population growth forecast for the coming years into account, so that we decreased the market rent accordingly to €
6.50/m²/month, which still represents an increase from the contractual rent of Kaufland. Regarding comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and
The following changes occurred in comparison to previous valuation: The lease of the tenants Deichmann (443 m²) and Convenience Concept GmbH (40 m²) were prolonged by 10 years. The tenant Reiseland
GmbH & Co. KG (62 m²) and Ihr Bäcker GmbH & Co. KG (73 m²) have extended their leases for a further 5 years. Some other small retail tenants have extended their leases for a further 1 year.
Page 10 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Photos
Sales area of Kaufland
View of the mall area
Indoor view of the main entrance and butcher and bakery shops
View of the delivery zone
View of the petrol station on site
View of discount furniture store next to the subject property
Page 11 of 12
abc
Property address
Property no.
1
Portfolio:
Matrix Portfolio
Hoymer Chaussee 108
Valuation date:
31.12.2013
06449 Aschersleben
Inspection date:
31.01.2011
Germany
Prepared for:
Leasing and Investment Market
Development of prime yields
Retail transaction volume in Germany
Leasing Market
Investment Market
There is no homogeneous rental level for retail space in retail warehouses or retail parks throughout
Germany. For the determination of the rents, the quality of location in terms of accessibility and
competition is crucial. The rents within the different branches vary. This is due to the diverging
location assessment and turnover expectancy of the different tenants. If in the case of a retail park
the management succeeds in establishing good anchor tenants, which guarantee a high visitor
frequency, then the turnover expectancy of secondary tenants tends to be higher and as a
consequence, their overall rental level will be higher as well.
Besides the rent level, another determining factor for investors is the building costs. Properties with
the highest rents usually also have the highest building costs and land acquisition cost. Depending
on the size of the retail unit and the branch of the tenants, rents in retail parks in western German
locations generally range between € 5.00 and € 13.00/m²/month. Depending on the size of the retail
unit and the retail format of the store, rents for supermarkets/ hypermarkets are generally slightly
higher than the rents for discounters. Such rents in cities with more the 30,000 inhabitants in western
German locations generally range between € 7.00 and € 13.00/m²/month.
Rents for discounters in western Germany generally range between € 6.00 and € 12.00/m²/month,
while discounters eastern Germany generally achieve slightly lower rental rates. Drugstores, textile,
shoe and electronics branches generally achieve rental rates ranging from € 7.50 to €
12.00/m²/month. DIY stores need extensive space due to their broad product range. In urban
centres, these stores sometimes even offer their products on two levels. DIY also fall at the lower end
of the scale in terms of rents, with prices ranging between € 6.00 and € 10.00/m²/month.
On the investment market in 2013, total capital amounting to € 30.7 billion was invested in German
commercial property – an increase of about 21% compared to the previous year. This means that 2013
was the strongest year for property transactions since the boom year of 2007. As was already seen in
the previous year, the final quarter of the year proved to be the strongest in terms of transactions.
Property worth around € 11.5 billion changed hands in the months from October to December, and this
volume was also € 1.5 billion higher than in the fourth quarter of the previous year.
Not all transactions that were initiated could be notarised in the last days of December, so that we
expect to see a very lively start to 2014.
As DIY stores have a supra-regional catchment area, there are not as independent as other
branches in the area and can relocate to more affordable attractive and easily accessible industrial
zones. In such areas, lower investments for realisation and lower building costs induce lower rents.
The good economic outlook on the domestic market also provides a basis of trust for property market
participants and attests to the attractiveness of Germany as a property investment destination. At the
same time this interest is equally supported by foreign and domestic investors.
The relation between the investment volume in the Big 7 and investments outside these established
markets has not changed from 2012. As before, around 60% (€ 19.5 billion) was invested in Berlin,
Düsseldorf, Frankfurt, Hamburg, Cologne, Munich and Stuttgart. Retail property was of primary interest
in other cities. High purchasing power and centrality indicators in densely populated and economically
strong catchment areas combined with strong demand from tenants such as national and international
retail chains means that second-tier cities are also of interest to investors.
The analysis of the different asset classes reveals no fundamental differences from 2012. Office
properties again accounted for the highest share of the transaction volume at 46%. Retail properties
accounted for a 26% share, followed by mix-used properties with 11% and warehouse and logistics
properties with at least 7%. The office prime yields were still on a slight downward trend in individual
cities. Each of the Big 7 cities now has a net initial yield of below 5%. Aggregated across all cities, the
prime yield in the office segment fell to an average value of around 4.67%. Shopping centre yields are at
a similar rate of 4.70%.
For 2014 we expect a stable development overall for yields. Based on the continuing strong demand for
prime properties the prime yields could even fall slightly again. At the same time, it will also depend on
how the capital market environment develops during the year. The interest rates will probably stay low
and therefore offer an attractive environment for companies and debt-oriented investors. A reduction in
the risk premium (on the basis of 10-year government bonds and the prime yield for office properties)
from almost 300 basis points at present to around 260 by the end of 2014 will also not restrict
investments in German commercial property.
Leasing Comparables
Tenant
Kaufland
Kaufland
Kaufland
real
OBI AG
Praktiker
Hellweg
toom
City
Crimmitschau
Staßfurt
Maulburg
Nordhorn
Rödermark
Magdeburg
Halberstadt
Staßfurt
Property Type
Self-Service Department Store
DIY
DIY
DIY
DIY
Area
4,661 m²
5,430 m²
4,435 m²
3,141 m²
11,566 m²
9,441 m²
5,434 m²
5,430 m²
Total Rent p.m.
€ 21,441
€ 32,526
€ 27,408
€ 20,888
€ 64,654
€ 61,367
€ 36,408
€ 32,526
Rent p. sqm
€ 4.60 /m²
€ 5.99 /m²
€ 6.18 /m²
€ 6.65 /m²
€ 5.59 /m²
€ 6.50 /m²
€ 6.70 /m²
€ 5.99 /m²
Comment
Worse purchasing power
Same federal state; similar purchasing power
Significantly better purchasing power
Slightly better purchasing power
Other federal state ,better purchasing power
Slightly worse purchasing power
Investment Comparables
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
Medium to long WALT, located in North Rhine-Westphalia
Medium to long WALT, located in Lower Saxony
Anchor tenant Kaufland & Toom, WALT below 5 years, portfolio transaction
Anchor tenant Marktkauf, WALT 17.5 years, very strong location in southern Germany
WALT 15.7 years, good location, main tenant Kaufland, partly leasehold
Anchor tenant Famila, WALT 9.2 years, strong location in northern Germany
Anchor tenant real, WALT 15 years, portfolio transaction
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
2
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Vertrieb GAMMA GmbH & Co. KG
Total lettable area
Total parking units
13,770 m²
550 units
19.4%
6.2 years
1969
1995
total p.a.
per m² / month
€ 1,203,705
€ 7.28
total p.a.
per m² / month
€ 158,727
€ 0.96
total p.a.
per m² / month
€ 1,044,978
€ 6.32
total p.a.
€ 1,487,432
-8.8%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Sufficient parking spaces
Good accessibility by car & public transport
Good tenant mix
Good location within the city district
0
The retail unit let to Kaufland is strongly underrented
Medium to high level of competition
Limited third party use of space let to Kaufland
Approx. 19.4% vacancy
0
Opportunities
Threats
Synergies from other wholesalers in the vicinity
Prolognation of the lease contracts after expiry
Re-letting of the vacant units
0
0
Re-letting or negotiations concerning the prolongation of existing contracts may result in worse
Difficult relettability of the fitness studio on 2nd floor
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
2
4
3
3
16 to 25 years
Between 12,500 and 15,000 m²
Average building condition
Average general impression
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
4
4
4
3
Good location and catchment area
Good micro location
Investment Quality
WALT
Over- / underrent
Quality of tenants
3 WALT three to seven years
4 Slightly underrented (-5% to -15%)
Investment market
Investment volume
Saleability
4 Well developed property market
4 Good lot size
The site is L-shaped and comprises a three-storey split levelled main building (in addition to a lettable basement level), an adjacent three-storey car park, offering approx. 550 parking spaces, as well as a petrol
station and a car wash. The construction of the main building started in 1969 along with the petrol station and the car park. A major modification took place in 1995 and the building in its existing form was finally
completed in 1997. The building structure is made of concrete columns, pre-cast concrete beams and concrete slab ceilings. It has a flat roof.
There are two main entrances; one from Gögginger Straße and one from Peter-Dörfler-Straße with access from the parking lot. The fitness centre has an additional separate entrance used after 8 p.m from PeterDörfler-Straße.
Kaufland comprises the basement and the ground floor. Other smaller retailers, such as a bakery, pharmacy, hairdresser, and discount clothier, occupy the remaining area along the mall on the ground floor. Two
escalators provide access to the basement, where produce can be found. This area could be divided into three parts with separate entrances. A fitness centre occupies the second floor. The third floor is a
mezzanine floor with plant rooms. The upper floors can be reached via escalators and lifts. The petrol station is located on Peter-Dörfler-Straße with two levels of parking overhead. Next to the petrol station is a
waiting zone for trucks.
Valuation Results
Market Value
€ 16,500,000
equals to
Market Rental Value
€ 1,198 per m²
€ 1,487,432 p.a.
Discount Rate
7.05%
Net Initial Yield
6.04%
Capitalisation Rate
6.75%
7.66%
excluding
capital
expenditures
Page 1 of 12
€ 9.00 / m² / p.m.
equals to
6.04%
13.71
7.66%
11.09
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Location
Germany
Bavaria
Augsburg (Urban District)
Augsburg
86199
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Augsburg
12,595,891
266,647
266,647
140,347
1,816
1816
1.1%
0.5%
1.2%
3.7%
2.6%
District
City
Federal State
District
District
in m €
in m €
index
index
index
5,469
5,469
109.20
99.47
132.15
Macro Location
Augsburg is one of the oldest German cities, along with Trier and Kempten. Today it is the third largest
city in the federal state of Bavaria, following Munich and Nuremberg. It lies in the south west part of
Bavaria within the metropolitan area of Munich and is home to approx. 265,000 inhabitants. Due to its
affordability, Augsburg has become a sought-after residence for commuters working in Munich, which is
a little more than an hour away by car. The number of commuters and housing rent have been
increasing.
Augsburg lies on the Lech and Wertach rivers and is situated near the motorway A8, connecting Munich
and Stuttgart. The federal roads through Augsburg are the B2, B10, B17 and B300. The main train
station offers regional connections as well as Intercity Express (ICE) connections to cities such as von
Munich, Berlin, Dortmund, Frankfurt am Main, Hamburg und Stuttgart. Direct express trains (EC) are
also offered to Vienna, Amsterdam, and Paris. Augsburg is a university town, as well as one of the most
significant industrial locations in southern Germany. It is home to the University of Augsburg and two
“Hochschulen”, as well as major research institutes. The service sector has been growing in the past
years and accounts for approx. 20% of employment. Many well-known companies are located in the city,
e.g. MAN Diesel, Walter Bau, Osram, Fujitsu Siemens Computers, EADS and MT Aerospace.
Micro Location
Micro Location
The property is located within the city district of Augsburg on the corner of Gögginger Straße, a major
arterial road, and Peter-Dörfler-Straße, approx. 4 km south of the city centre. Major roadways B17 and
B300 intersect with Gögginger Straße, just south of the property. The retail building is easily accessible
from city by car in approx. 15 minutes. Sufficient parking at the property is provided by a multi-storey car
park. The retail park is also easily accessible via public transport, as bus and tram stops are located
directly in front of the building. The surrounding area is mostly residential and commercial area. Other
large retail warehouses are located in close vicinity, such as Promarkt (electronics), Media Markt
(electronics), Lidl and Aldi (discount supermarkets), and a Netto Marken Discount (discount store). A
hagebaumarkt (DIY store) can be found just 5 minutes in the direction of the city centre.
A high school is also located at just a 5 minutes walk to the south on Gögginger Straße.
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
485
3.5
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Site Plan
Source: Cadastral plan dated 30.06.2008
Site Information
Site area
20,862 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
Yes
Comment
The site consists of six plots: 421/10, 415/28, 415/29, 415/30, 415/31, 421. The site has an even
topography and an irregular shape. It is surrounded by a road to the west and to the north and a small
paved road to the east. According to the environmental due diligence dated July 2007, the site is not
registered in the “Altlastenkataster” (contaminated land cadastre). The general risk of subsoil
contamination at the Kaufland site without petrol station and car wash is considered to be low to
moderate. This risk is moderate to high for the site with the petrol station and car wash. For the
purposes of this valuation, we have assumed that the subject property is free of any soil or building
contamination.
Town Planning
Use class
SO (special zone)
n.a.
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority, no legally binding development plan exists.
Town planning issues are governed by § 34 of the German Federal Building Code. This paragraph
stipulates that new developments and their designated uses are required to blend in with their
immediate surroundings, so as to show consideration of nearby types of uses. According to the local
planning authority, the site could be characterized as (SO) special zone with mixed-use including
commercial.
Tenure
Owner
Land Register
TPL Biberach S.á.r.l.,
Local Court of
Augsburg, land register Luxembourg
of Göggingen
Sheet
10640
Plot
0
Parcel
421/10
415/28
415/29
415/30
415/31
421
Section 3 (Loans)
There are several limited personal easement:
Land charges in the total amount of € 105,000,000 in
Right of fuel service station in favour of CONOCO favour of COREAL CREDIT BANK Aktiengesellschaft
Mineraloel GmbH, plot 421; Right of transformer Frankfurt, 11th May 2011.
station and pipeline in favour of Lech
Elektrizitätwerke, plot 421; Right of way on
sidewalk in favour of the municipality of Augsburg,
plots 415/28, 415/29, 415/31; Right of noise
barrier in favour of the municipality of Augsburg,
plots 415/29, 415/31; Right of gas & water
pipeline in favour of the municipality of Augsburg;
plots 415/28, 415/29, 415/30, 415/31; Right to
hold and operate a self-service department store
in favour of Kaufland Dienstleistung GmbH & Co.
KG, plots 421/10, 415/28, 415/29, 415/30,
415/31, 421. Easement (right of access) in favour
of the owner of plot 421/24.
Page 3 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Marktkauf
Rewe
E-center
Rewe
E-center
Hüdaverdi Süpermarket
Marktkauf
Rewe
Rewe
Real
Edeka
Rewe
Type
Self-service dep. store
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Address
86199 Augsburg, Bergiusstr. 1
86150 Augsburg, Viktoriastr. 3
86153 Augsburg, Willy-Brandt-Platz 1
86153 Augsburg, Jakoberwallstr. 9
86161 Augsburg, Wilhelm-Hauff-Str. 34
86153 Augsburg, Böheimstr. 6A
86391 Stadtbergen, Hagenmähderstr. 47
86179 Augsburg, Haunstetter Str. 239-241
86391 Stadtbergen, Benzstr. 7
86161 Augsburg, Reichenberger Str. 59
86391 Stadtbergen, Benzstr. 12
86154 Augsburg, Donauwörther Str. 64
Sales area
6,144 m²
2,807 m²
2,300 m²
2,300 m²
2,259 m²
2,000 m²
3,475 m²
1,600 m²
1,650 m²
7,500 m²
1,800 m²
1,800 m²
Distance
0.70 km
2.20 km
2.80 km
3.30 km
3.40 km
3.50 km
3.80 km
3.90 km
4.00 km
4.00 km
4.10 km
4.10 km
Potential
High
Medium
Low
Low
Low
Low
Medium
Low
Low
Medium
Low
Low
230,672
174,315
122,215
84,761
99.47
5,469
21,097
2.6%
Page 4 of 12
1.1%
132.15
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
2
Main competitors
This competitor is a Marktkauf (self-service department store), located less than 1km from the
subject property. It is similar in size and condition and offers a similar product assortment. It is laid out
in a retail park with a shared open parking lot. There is also a petrol station on the site. This is a
direct competitor.
This competitor is a real,- (self-service department store). It is located approx. 4km from the subject off
of the main road B2 in a commercial area east of the city centre. It is somewhat larger in size and
comprised of only one floor with high ceilings. A bakery, flower shop, delicatessen and beverage store
are on the site, as well as an open parking lot and a parking garage. This competitor poses a medium
level of competition.
Competition Comment
Catchment area is divided into 2 categories: primary (5 km radius) and secondary (10 km radius). Approximately 231,000 inhabitants live in the primary catchment area and fifteen self-service department stores are
present. This correlates to approx. 15,400 inhabitants, i.e. potential customers, per store. Within the broader secondary catchment area there are 174,000 inhabitants and a total of seventeen self-service
department stores, equalling about 10,300 potential customers per store. We consider there to be 3 main competitors for the subject property: a Marktkauf, a real,- and another Kaufland.
The most direct competitor is a Marktkauf, located less than 1km away. Situated directly off the main arterial roads B17 and B300, it has very good accessibility and visibility. It is laid out in a retail park with a shared
open parking lot, different to that of Kaufland. The neighbouring stores, as well as a petrol station and car wash, offer a wide variety of options to the consumer and are mostly well-known retailers. This is a strong
competitor due to its close proximity and the similar tenant mix. A real,- is located about 4km from the subject off of the federal road B2 in a commercial area east of the city centre. There is an OBI (DIY store) and a
Norma (discount supermarket) nearby. It is laid out over only floor, which is preferable, and the building itself is newer, but since it will draw mainly residents from the eastern part of Augsburg, we believe it poses
only a medium-level of competition.
Another Kaufland can be found north-east of the city centre in the district of Lechhausen. It is somewhat larger with retail spread out over two floors (ground floor and 1st floor).This Kaufland offers a similar
shopping experience to the consumer, yet based on the distance from the subject property, we consider it to pose only a medium-level of competition, as it mostly draws customers living north-east of the city centre.
There are a substantial number of competitors within the primary and secondary catchment areas; however, when considering the number of potential consumers, the market cannot be described as oversaturated.
Furthermore, the population growth for the county (“Landkreis”) is forecasted to grow by 1.1% between years 2009 and 2025; and according to the “Wirtschaftsförderung” of Augsburg, there are currently no selfservice department stores in planning. Accordingly, the overall competitive environment can be described as medium to high.
Turnover analysis
For the purpose of this valuation, we have used the average turnover rents for the years 2008 and 2009 until the end of the respective lease agreement. The rents in functional retail agglomerations are linked to
turnover. The percentage that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate normally ranges between 2% and 15% depending on the
respective branch. Kaufland is a strong anchor, we believe that there will continue to be demand for such ancillary tenants. For Kaufland, we have also been provided with turnover figures. We have analysed the
figures and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department
store. Hence, we believe that a higher market rent is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.
0
Conclusion
The property is currently used as a self-service department store (Kaufland), making up 56% of lettable area, a fitness centre (McFit) also takes up close to 16% of the total lettable area, and the rest is divided
between smaller retailers with the indoor mall area. A car park offers plentiful parking, and a petrol station and car wash are also located on the property. The micro-location is good for it is easily accessible by car
and public transport. Despite a high level of competition, the property should compete strongly due its good location and the synergies effects created through other large retailers (Media Markt and Hagebau) in the
immediate area. The catchment area should suffice, despite the significant number of competitors. Furthermore, the population growth for the district (“Landkreis”) is forecasted to grow by 1.1% between years 2009
and 2025 and there is no evidence of self-service department stores in planning according to the “Wirtschaftsförderung” of the city of Augsburg.
Kaufland splits its retail area between the ground floor and the basement, which is less preferable to a one-floor building, making it difficult to let if Kaufland were to leave. It would be difficult to envision another use;
the best use would remain to be a self-service department store. Therefore, if Kaufland were to leave, a major competitor, such as real,- Marktkauf or Edeka would be a likely replacement. The fitness centre on the
2nd floor may be difficult to re-let in the future if McFit were to leave. Foreseeable future use of the upper floors could be a furniture store or electronics store. It is highly probable that the fitness centre will continue
to let the space on the 2nd floor, due to the good micro-location close to a large residential area. Kaufland’s lease does not expire until 2022 and it has options to extend until 2037. On the basis of our projection of
likely productivity per m² and turnover, we have calculated the market rent at € 7.60 /m²/month. The tenant currently pays a contractual rent of € 5.50/m²/month. Hence, we expect Kaufland to stay until 2037 (based
on its below-market rental level), as long as it continues to generate adequate turnover.
Page 5 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Kaufland Vertrieb GAMMA GmbH & Co. KG
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
7,775
€ 42,763
5.50
Yes
01.10.2007
30.09.2022
2 Frisör Thonet GmbH
Retail
Let
72
€ 1,618
22.59
Yes
25.10.2005
24.10.2020
75%
GT I PM
3 Solak
Retail
Let
18
€ 702
38.15
Yes
01.04.2011
31.03.2016
75%
90%
GT I PM
4 KiK Textilien und Non-Food GmbH
Retail
Let
461
€ 4,075
8.84
Yes
01.04.2003
21.03.2023
75%
GT I PM
5 Friedberger Landbrot Brezń Baur GmbH
Retail
Let
39
€ 1,327
34.03
Yes
01.11.2013
31.10.2018
75%
GT I PM
6 BRL Center GmbH
Retail
Let
144
€ 4,057
28.27
Yes
01.08.2008
31.07.2028
75%
GT I PM
GT I PM
7 Vacant
Retail
Vacant
41
€0
0.00
8 Vincent Murr Vertriebs GmbH
Retail
Let
80
€ 3,372
42.15
Yes
31.03.2006
30.03.2016
75%
9 McFit GmbH
Retail
Let
2,220
€ 11,105
5.00
Yes
17.10.2002
16.10.2014
75%
GT I PM
10 Landbäckerei Ihle GmbH
Retail
Let
107
€ 5,448
50.92
Yes
01.11.2006
30.04.2016
75%
GT I PM
11 Neckermann Urlaubswelten GmbH & Co. KG
Retail
Let
55
€ 1,327
24.13
Yes
01.10.2010
15.05.2016
75%
GT I PM
12 SO-Tel Service GmbH u. Co. KG
Retail
Let
34
€ 600
17.65
Yes
01.09.2013
30.11.2018
75%
GT I PM
Yes
02.01.2004
24.10.2015
75%
GT I PM
13 Glanzer
Retail
Let
26
€ 1,076
41.21
14 Vacant
Retail
Vacant
27
€0
0.00
15 Thi Dung
Retail
Let
39
€ 1,058
26.86
Yes
17.05.2006
31.07.2016
75%
GT I PM
16 Thi Dung
Storage
Let
28
€ 108
3.85
Yes
01.10.2006
15.05.2016
75%
GT I PM
Other Units
Let
1
€0
0.00
Yes
01.06.2007
30.11.2014
100%
€ 486
485.83
17 FOTOFIX Schnellphotoautomaten GmbH
Other Units
Let
02.08.2014
100%
19 ConocoPhillips Germany GmbH
Petrol Station
Let
200
€ 3,593
17.96
Yes
01.03.1978
31.12.2015
100%
Petrol Station
Let
200
€ 6,739
33.70
Yes
01.03.1978
31.12.2015
100%
21 Kiosk
Other Units
Let
1
€ 123
123.00
Yes
00.01.1900
31.12.2014
100%
22 Turnover rent
Other Units
Let
1
€ 410
410.00
n.a.
00.01.1900
31.12.2014
100%
Retail
Vacant
2,604
€0
0.00
Let
18 Deutsche Plakat-Werbung GmbH & Co. KG
23 Vacant
1
Yes
03.08.2009
M GT I PM
11
€ 88
8.03
31.03.2013
31.12.2014
100%
25 Hosokawa Alpnie Aktiengesellschaft
Other Units
Let
1
€ 1,750
1750.00
n.a.
16.01.2012
31.12.2014
100%
M GT I PM
26 transact Elektronische Zahlungssysteme GmbH
Other Units
Let
1
€ 51
51.13
n.a.
01.01.2007
31.12.2014
100%
M GT I PM
Internal parking
Let
550
€ 8,333
15.15
No
01.10.2007
30.09.2022
100%
Other Units
Let
1
€ 100
100.00
n.a.
01.08.2013
31.12.2014
100%
14,170 m²
€ 100,309
27 Internal Parking
28 Stadtwerke Augsburg Verkehrs GmbH
Other Units
Total
Yes
M GT I PM
Page 6 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Area Category
Area
sqm/unit
Market
Rent
Market
Rent /month
1 Kaufland Vertrieb GAMMA GmbH & Co. KG
Retail
7,775
2 Frisör Thonet GmbH
Retail
72
3 Solak
Retail
18
€ 25.00
€ 7.60
€ 59,091
€ 50
0
€ 15.00
€ 1,074
€ 100
0
€ 460
€ 100
0
12
Retail
461
€ 7.00
€ 3,227
€ 100
0
5 Friedberger Landbrot Brezń Baur GmbH
Retail
39
€ 30.00
€ 1,170
€ 100
6 BRL Center GmbH
Retail
144
€ 25.00
€ 3,588
7 Vacant
Retail
41
€ 25.00
8 Vincent Murr Vertriebs GmbH
Retail
80
€ 22.00
9 McFit GmbH
Retail
2,220
€ 4.50
10 Landbäckerei Ihle GmbH
Retail
107
11 Neckermann Urlaubswelten GmbH & Co. KG
Retail
55
12 SO-Tel Service GmbH u. Co. KG
Retail
34
13 Glanzer
Tenant Name
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
12
0
3
10
10%
12
0
3
5
25%
0
3
5
25%
12
0
3
5
25%
0
12
0
3
5
25%
€ 100
0
12
0
3
5
25%
€ 1,025
€ 100
6
12
0
3
5
100%
€ 1,760
€ 100
0
12
0
3
5
25%
€ 9,990
€ 100
0
12
0
3
5
25%
€ 40.00
€ 4,280
€ 100
0
12
0
3
5
25%
€ 22.00
€ 1,210
€ 100
0
12
0
3
5
25%
€ 25.00
€ 850
€ 100
0
12
0
3
5
25%
Retail
26
€ 25.00
€ 653
€ 100
0
5
25%
14 Vacant
Retail
27
€ 22.00
€ 594
€ 100
6
12
0
3
5
100%
15 Thi Dung
Retail
39
€ 25.00
€ 985
€ 100
0
12
12
0
0
3
3
5
25%
16 Thi Dung
Storage
28
€ 0.00
€0
€0
0
0
0
0
5
25%
Other Units
1
€ 43.90
€ 44
€0
0
0
0
0
5
0%
Other Units
1
€ 485.83
€ 486
€0
0
0
0
0
5
0%
Petrol Station
200
€ 17.96
€ 3,593
€ 100
0
12
0
3
5
0%
Petrol Station
200
€ 33.70
€ 6,739
€ 100
0
18
0
3
5
0%
0%
21 Kiosk
Other Units
1
€ 10.25
€ 10
€0
0
0
0
0
5
22 Turnover rent
Other Units
1
€ 34.17
€ 34
€0
0
0
0
0
5
0%
Retail
2,604
€ 4.75
€ 12,370
€ 100
15
12
0
3
5
100%
Other Units
23 Vacant
11
€ 44.17
€ 486
25 Hosokawa Alpnie Aktiengesellschaft
Other Units
1
€ 1750.00
€ 1,750
€0
0
0
0
0
5
0%
Other Units
1
€ 51.13
€ 51
€0
0
0
0
0
5
0%
Internal parking
550
€ 15.15
€ 8,333
€0
0
0
0
0
5
0%
Other Units
1
€ 100.00
€ 100
€0
0
0
0
0
5
0%
27 Internal Parking
28 Stadtwerke Augsburg Verkehrs GmbH
Total
* months
14,170 sqm
** years
€0
0
0
0
0
5
0%
€ 123,953
Page 7 of 12
.
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
13,742
0
0
0
0
28
13,770
400
18
550
0
968
Area Vacant
m²
0
2,672
0
0
0
0
0
2,672
0
0
0
0
0
Area Let
m²
0
11,070
0
0
0
0
28
11,098
400
18
550
0
550
Vacancy Rate
%
0.00%
19.45%
0.00%
0.00%
0.00%
0.00%
0.00%
19.41%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
7.09
0.00
0.00
0.00
0.00
3.85
25.83
167.13
8.29
15.15
0.00
Contractual
Rent
€/month
0
78,527
0
0
0
0
108
10,332
3,008
91,975
8,333
0
Contractual
Rent
€/year
0
942,329
0
0
0
0
1,294
123,983
36,099
1,103,705
100,000
0
Potential
Rent
€/year
0
1,181,098
0
0
0
0
1,294
123,983
36,099
1,342,474
100,000
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
7.45
0.00
0.00
0.00
0.00
0.00
25.83
164.51
8.40
15.15
0.00
Market
Rent
€/year
0
1,227,916
0
0
0
0
0
123,983
35,534
1,387,432
100,000
0
Market
Rent
€/month
0
102,326
0
0
0
0
0
10,332
2,961
115,619
8,333
0
Over-/ UnderRented
0.0%
-4.7%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
1.6%
-1.3%
0.0%
0.0%
Space productivity
7,000
10.00
6,500
9.00
Explanation
9.38
6,000
Market rent
Contractual Rent
8.00
7.60
Rent / m² / month
5,500
5,000
4,500
Rents
7.04
7.00
6.00
5.00
4.00
4,394
3,500
2.3%
5.50
Market
3.2%
7.60
5.50
4.69
4,000
4% of turnover
9.38
3% of turnover
7.04
in € / m² p.a.
21,884,417 €
(net)
Sales Area
2.00
1.0%
4.69
2% of turnover
Turnover potential
3.00
3,000
€ / m²
%
Contractual
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 4,980 m²
7,775 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Vertrieb GAMMA GmbH & Co. KG
€ 513,155
43%
8.7 years
73
O2
2
70
€ 25,000 (single) € 165,000 (total)
The main tenant is a corporation belonging to the Kaufland Group, which in turn belongs to the Lidl &
Schwarz Group, one of the biggest grocer groups in Europe. Kaufland is the self-service department
store division of Lidl & Schwarz with more than 500 locations across Europe. Kaufland’s core business
area is food retailing with branded goods and own-brands specially produced for Kaufland. The risk of
insolvency (D&B Score) is low, i.e. 70% of businesses on the German database have the same or
higher risk. According to section 19 of the main lease agreement entered into by the landlord and
Kaufland Dienstleistung GmbH & Co. KG (Rating = 2AA 1), an assignment of the main lease agreement
by the tenant to another entity of the Kaufland group requires that the landlord's credit risk rating may
not deteriorate due to such assignment of the lease.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
2
Market Value
The property is let to twelve retail tenants, a fitness studio, a petrol station and car wash. Approximately 2,672 m² are vacant at the moment. The WALT amounts to 6.2 years. The main tenant is Kaufland with a
share of approx. 43% of the rental income. The property is currently strongly under-rented mainly due to the low rental level of Kaufland. The lease is valid until 2022 with options until 2037; therefore, we do not
believe that the rental level will be adjusted before 2037. Kaufland’s rent is indexed and is adapted by 50% of the CPI change, when the change exceeds 10% in relation to the CPI basis. Indexation started on
01.04.2009. Ground tax, maintenance costs for structural repairs, management and insurance costs are not borne by Kaufland. The rest can be apportioned to the tenant in accordance with the German Regulation
on Operating Costs.
The following tenants have extended their lease contracts: Friedberger Landbrot Brezń Baur GmbH until 10/18, FOTOFIX until 11/2014 and transact Elektronische Zahlungssysteme GmbH until 12/14.
Discount rate
7.05%
Capitalisation rate
6.75%
reinsurance, the initial yields profile is aligned with the market/other transactions. We have taken into
vacancy rate as well as the location within the federal state Bavaria.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.31 /m²
€ 4.41 /m²
€ 0.31 /m²
€ 0.00 /m²
€ 11.53 /m²
€ 75,737
€ 18,056
€ 60,716
€ 4,219
€0
€ 158,727
per year
per year
€ 5.50 /m²
€ 1.62 /m²
€ 4.41 /m²
€ 0.31 /m²
€ 0.00 /m²
€ 11.84 /m²
€ 75,737
€ 22,311
€ 60,716
€ 4,219
€0
€ 162,983
Inflation
% of Gross
Contract Rent
6.29%
1.50%
5.04%
0.35%
0.00%
13.19%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.09%
1.50%
4.08%
0.28%
0.00%
10.96%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 75,737
€ 76,948
€ 78,318
€ 79,697
€ 80,988
€ 82,267
€ 83,584
€ 84,938
€ 86,280
€ 87,557
€ 88,835
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 17,910
€ 19,998
€ 20,075
€ 20,359
€ 20,311
€ 20,300
€ 19,681
€ 20,695
€ 20,735
€ 21,463
€ 21,427
Insurance
Costs
€ 4,219
€ 4,286
€ 4,363
€ 4,439
€ 4,511
€ 4,583
€ 4,656
€ 4,731
€ 4,806
€ 4,877
€ 4,948
Ground
Tax
€ 60,716
€ 61,687
€ 62,785
€ 63,891
€ 64,926
€ 65,951
€ 67,007
€ 68,092
€ 69,168
€ 70,192
€ 71,216
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 188,664
€ 171,457
€ 166,339
€ 168,386
€ 170,836
€ 173,383
€ 188,370
€ 179,400
€ 188,408
€ 185,422
€ 186,840
Vacancy
Costs
€ 30,082
€ 8,538
€ 798
€0
€ 100
€ 282
€ 13,442
€ 944
€ 7,419
€ 1,333
€ 414
% of Total
Gross Revenue
15.8%
12.9%
12.4%
12.4%
12.6%
12.8%
14.4%
13.0%
13.6%
13.0%
13.1%
18.0%
16.0%
15.8%
14.4%
14.0%
12.9%
12.4%
12.4%
12.6%
12.8%
13.0%
13.6%
13.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,373,511
€ 1,382,439
€ 1,366,200
€ 1,357,265
€ 1,357,543
€ 1,361,783
€ 1,388,801
€ 1,411,535
€ 1,451,498
€ 1,442,146
€ 1,441,395
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 179,530
-€ 49,256
-€ 27,855
€0
-€ 3,459
-€ 8,444
-€ 76,743
-€ 31,853
-€ 69,184
-€ 11,246
-€ 12,897
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,193,981
€ 1,333,183
€ 1,338,345
€ 1,357,265
€ 1,354,084
€ 1,353,339
€ 1,312,058
€ 1,379,682
€ 1,382,314
€ 1,430,900
€ 1,428,498
Nonrecoverable
Costs
-€ 188,664
-€ 171,457
-€ 166,339
-€ 168,386
-€ 170,836
-€ 173,383
-€ 188,370
-€ 179,400
-€ 188,408
-€ 185,422
-€ 186,840
Net
Operating
Income
€ 1,005,317
€ 1,161,726
€ 1,172,006
€ 1,188,879
€ 1,183,248
€ 1,179,956
€ 1,123,688
€ 1,200,282
€ 1,193,906
€ 1,245,478
€ 1,241,658
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 6,800
-€ 4,896
€ 993,621
-€ 316,808
-€ 45,494
€ 799,424
-€ 8,426
-€ 7,321
€ 1,156,259
€ 1,188,879
€0
€0
€0
€ 1,183,248
€0
-€ 2,983
-€ 3,828
€ 1,173,145
-€ 18,634
€ 971,954
-€ 133,100
€ 1,182,217
-€ 10,040
-€ 8,025
-€ 15,624
-€ 45,409
€ 1,132,873
-€ 13,324
-€ 2,818
€ 1,229,336
€ 18,569,161
-€ 1,786
-€ 2,141
Present
Value @
7.05%
€ 963,793
€ 717,165
€ 978,378
€ 939,507
€ 873,549
€ 808,914
€ 625,106
€ 711,591
€ 638,142
€ 645,538
€ 9,395,623
€ 17,297,306
€0
€ 17,297,306
8.0%
€ 1600000.0
7.2%
€ 1400000.0
6.7%
6.8%
6.9%
6.8%
6.9%
6.8%
6.9%
7.0%
6.5%
6.0%
€ 1000000.0
5.0%
€ 800000.0
4.0%
€ 600000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
1.0%
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,203,705
€ 7.28
Market rental value
total p.a.
per m²/month
€ 1,487,432
€ 9.00
-8.78%
Over-/Underrent
Year 8
Running yield
Rental income
5.8%
€ 1200000.0
Total
€ 17,300,000
per m²
€ 1,256
Purchaser's costs
5.00%
Yield Overview
Net Initial Yield
6.04%
7.66%
Gross Initial Yield
7.30%
9.01%
Total
€ 16,500,000
per m²
€ 1,198
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 28.01.2014, the main tenant Kaufland Vertrieb GAMMA GmbH & Co. KG has above average
covenant strength and a low credit risk. According to section 19 of the main lease agreement entered into by the landlord and Kaufland Dienstleistung GmbH & Co. KG (D&B Rating = 2AA 1), an assignment of the
main lease agreement by the tenant to another entity of the Kaufland group requires that the landlord's credit risk rating may not deteriorate due to such assignment of the lease. Section 1 of the first amendment to
the main lease agreement provides for the assignment of the main lease agreement to Kaufland Vertrieb GAMMA GmbH & Co. KG, which has a worse D&B Rating (O3). Accordingly, pursuant to section 2 of the
first amendment to the main lease agreement, the former tenant remains jointly and severally liable for the landlord's payment claims. Hence, the former tenant is a guarantor for the lease payments of the current
tenant. Upon resale we took into account visibility, demographic factors, appearance, condition and building age, third party usability, competition and location.
For the purpose of the valuation on 31.12.2013, we have not been provided with a new non-recoverable costs schedule by the asset manager.Therefore we have remained all non-recoverable service charges
unchanged and have been applied according to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent. Regarding comparable rents, we
have evidence of similar areas situated in comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the section "Investment Comparables". We have not been
provided with updated information regarding necessary capital expenditures. However, we assume these costs are covered by the sinking fund budget of € 5.50/m² p.a. for on-going maintenance measures.
For some tenants, we have been provided with the turnover figures and have applied there figures in our valuation. Based on provided information from Brack Capital, we have additionally considered parking
income of approx. € 100,000 p.a.
The following changes have taken place compared with 31. March 2013: The gross rental income decreased approx. € 125,000 due to the new vacancy of 2,700 m² (19.4%). The remaining lease term is nine
month shorter (6.2 yrs). Therefore the discount rate has been adjusted by 15 bps upwards to 7.05. The cap rate remained unchainged.
Page 10 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Photos
Main entrance to Kaufland
View of the mall
Internal view of sales area of Kaufland
View of retail area
Internal view of McFit fitness studio (2nd floor)
View of the car park and petrol station
Page 11 of 12
abc
Property address
Property no.
2
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
86199 Augsburg
Inspection date:
31.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Marktkauf
Kaufland
McFit
KiK
KiK
Pharmacy
Deichmann
0
City
Lübbenau
Geldern
Bochum
Straubing
Heilsbronn
Nürnberg
Karlstadt
0
Property Type
Fitness Studio
Discount Fashion
Discount Fashion
Pharmacy
Shoe store
0
Area
5,479 m²
8,478 m²
1,600 m²
657 m²
500 m²
140 m²
467 m²
0 m²
Total Rent p.m.
€ 42,353
€ 65,705
€ 7,840
€ 4,901
€ 4,090
€ 3,885
€ 4,553
€0
Rent p. sqm
€ 7.73 /m²
€ 7.75 /m²
€ 4.90 /m²
€ 7.46 /m²
€ 8.18 /m²
€ 27.75 /m²
€ 9.75 /m²
€ 0.00 /m²
Comment
Other federal state
Other federal state; similar purchasing power
Other federal state; slightly lower purchasing power
Similar purchasing power
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
3
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Vertrieb 84 GmbH & Co. KG
Total lettable area
Total parking units
7,053 m²
300 units
0.0%
4.1 years
2000
n.a.
total p.a.
per m² / month
€ 636,025
€ 7.52
total p.a.
per m² / month
€ 73,647
€ 0.87
total p.a.
per m² / month
€ 562,378
€ 6.64
total p.a.
€ 695,930
-8.6%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Sufficient parking
Good building condition
Long remaining lease term of the anchor tenant
0
0
Low visibility from the main road
0
0
0
Opportunities
Threats
Positive population growth forecast for the district (Rosenheim)
Low unemployment rate
0
0
Re-letting or negotiations concerning the prolongation of existing contracts may result in worse
Termination of short term lease contracts with subsequent void periods
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
3
1
3
3
11 to 15 years
Smaller than 7,500 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
3
3
3
Average location and catchment area
Limited commercial activity nearby
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
3 Average property market
3 Reasonable lot size
The site comprises a single storey U-shaped retail park, separated into 3 wings which are called the west, east and north wing. The north wing is a 2-storey building (main building) with no basement. An open
parking lot with approx. 300 parking spaces is provided to the front of the main building and on the left- and right-hand side of the U-shaped building. Construction of the property began in 1999 and was completed
in 2000. The buildings are rectangular in shape and constructed with concrete columns, pre-cast concrete beams and concrete slab ceilings. The building has a flat roof covered by folio.
Kaufland is the anchor tenant occupying retail space on the ground floor of the main building. Office space and some storage and personnel rooms are located on the 1st floor. The entrance to the north wing is in
the front of the building facing the parking lot. The other retail units, which include a drugstore, textile stores, shoe store, etc., have separate entries from the parking lot. The property includes space to the backside
of the northern building for delivery and removal.
Valuation Results
Market Value
€ 8,100,000
equals to
Market Rental Value
€ 1,148 per m²
€ 695,930 p.a.
Discount Rate
7.50%
Net Initial Yield
6.62%
Capitalisation Rate
6.75%
7.31%
excluding
capital
expenditures
Page 1 of 12
€ 8.22 / m² / p.m.
equals to
6.62%
12.74
7.31%
11.64
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Location
Germany
Bavaria
Rosenheim (Rural District)
Bad Aibling
83043
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Bad Aibling
12,595,891
251,105
18,405
8,536
174
444
7.5%
0.5%
1.5%
3.7%
2.7%
District
City
Federal State
District
District
in m €
in m €
index
index
index
5,545
398
109.20
104.75
75.52
Macro Location
Bad Aibling is a spa town in the south of the federal state Bavaria with approx. 18,000 inhabitants. It lies
on the river Mangfall, in the administrative district of Rosenheim, approx. 50 km southeast of Munich. It
has become a sought-after residence for commuters working in Munich.
Bad Aibling has good accessibility through federal motorways and major roads. It is located near the
motorway A8 (Munich-Salzburg). The major road which runs through the city is the state road St 2078
(Munich-Rosenheim). The city is considering building another bypass (bypass road north), to lead the
traffic flowing north, towards Großkarolinenfeld and Tuntenhausen around the city. The train station
offers regional connections.
The economic focus of Bad Aibling is on the health care and wellness sector. There are several cure
hospitals and rehabilitation centres. Companies in the pharmaceutical sector, textiles, electronic
industry, and milk processing industry can be found in the city. The unemployment rate for the district
lies at 3.8%, well below the national average (7.9%).
Micro Location
Micro Location
The property is located in a small commercial area at the city’s western periphery, on Grassingerstraße.
Accessibility is good as Grassingerstraße is just off the main arterial road Münchenerstraße. However,
the property cannot be seen from the main road and therefore has poor visibility. A bus stop is located at
about 2 minutes walking distance. The property is approx. 5 minutes by car and 10 minutes walking
distance from the city centre. The surrounding area is mostly residential and undeveloped land. A police
station, car dealership, a sporting goods store, as well as an Aldi (discount supermarket) can be found in
close vicinity.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
330
3.5
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Site Plan
Source: Cadastral plan on a 1 to 1000 scale, dated 27.12.2010
Site Information
Site area
19,222 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
Comment
The site consists of plots 1131 and 1072. It has an even topography and an irregular shape. It is
surrounded by a road to the east and a small paved delivery access road around the site to the south,
west and north. According to the environmental due diligence dated July 2007, plots 1072 and 1131 are
not registered in the “Altlastenkataster” (contaminated land cadastre). For the purposes of this valuation,
we have assumed that the subject property is free of any soil or building contamination.
Yes
Town Planning
Use class
SO (special zone)
0.6
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to the local planning authority, a legally binding development plan exists, entitled
"Bebauungsplan 51 Nördlich der Grassingerstraße", dated 3 August 1992, date of last amendment 23
May 2003, with the following regulations: subject site is located in a special zone retail (SO). The plot
ratio (GFZ) is 0.6 and the site coverage ratio (GRZ) is not specified.
Tenure
Land Register
Local Court of
Rosenheim, land
register of Bad Aibling
Owner
TPL Biberach S.á.r.l.,
Luxembourg
Sheet
7174
7630
Plot
0
Parcel
1131
1072
Section 3 (Loans)
Limited personal easement (right to operate a self- Land charges in the total amount of € 105,000,000 in
service department store) in favour of Kaufland
favour of COREAL CREDIT BANK Aktiengesellschaft
Dienstleistung GmbH & Co. KG, Neckarsulm.
Frankfurt, 11th May 2011.
Page 3 of 12
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Edeka Wendelstein Frischecen
Rewe
E-center van Dungen
E-center
Kaufland
Rewe
Real
0
Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Address
83043 Bad Aibling, Ebersberger Str. 1
83059 Kolbermoor, An der Alten Spinnerei 4
83059 Kolbermoor, Carl-Jordan-Str. 18
83026 Rosenheim, Grubholzer Str. 2a
83026 Rosenheim, Äußere Münchener Str. 100
83024 Rosenheim, Hofmillerstr. 1
83026 Rosenheim, Kufsteiner Str. 124
Sales area
2,305 m²
2,000 m²
2,699 m²
3,507 m²
5,200 m²
1,500 m²
6,500 m²
m²
Distance
0.30 km
5.10 km
5.80 km
7.40 km
7.40 km
9.20 km
9.80 km
Potential
High
Medium
Medium
Low
Low
Low
Low
0
0
0
0
0
37,614
98,485
17,340
48,888
7.5%
104.75
75.52
Page 4 of 12
5,545
21,825
2.7%
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
3
Main competitors
This competitor is an Edeka Frischemarkt. It is much smaller in size and offers a more limited product
assortment than the anchor tenant of the subject property. It has, however, greater visibility as it lies
on the main road and needs to be passed in order to reach the subject property, which is just around
the corner. The building is newer. Furthermore, a Müller (drugstore) is located on the site. This
competitor poses a medium level of competition.
This competitor is an Edeka E-Center. It is similar in size and is located approx. 6km east of the subject
property in the town of Kolbermoor. The E-Center has retail on the ground floor and a fitness studio on
the 1st floor. It is located in a retail park surrounded by smaller retail shops, such as a shoe store,
optician, jewellery shop, dry cleaner, and two discount fashion stores, among others. This competitor
poses a medium level of competition.
Competition Comment
Catchment area is divided into 2 categories: primary (5 km radius) and secondary (10 km radius). Approximately 37,600 inhabitants live in the primary catchment area. There are two self-service department
stores/hypermarkets, including the subject property, present in this area, which is approx. 18,800 inhabitants per store. Within the broader secondary catchment area of approx. 98,500 inhabitants, there are 6 main
competitors: an Edeka Frischemarkt, an Edeka E-Center, two Rewe, a Kaufland and a Real.
The Edeka Frischemarkt is about 1,000 m² smaller and offers a more limited product assortment than Kaufland. It does have, however, greater visibility as it lies on the main road and needs to be passed in order to
reach the subject property, just around the corner. The building is significantly newer.
Furthermore, a Müller (drugstore) is located on the site, which is comparable to the dm-markt (drugstore) next to the subject property. Despite its smaller size, we consider it to be a strong competitor based on its
close proximity and preferred location.A bit farther away, approx. 6 km, in the town of Kolbermoor, an Edeka E-Center and a Rewe can be found. They are surrounded by a mostly residential area and located off of
the state road St 2078 between Bad Aibling and the city of Rosenheim. Both hypermarkets are set within retail parks with outdoor parking. They will mainly draw inhabitants of Kolbermoor and possibly those from
the eastern part of Bad Aibling and those who commute to Rosenheim for work. Therefore, they pose a medium level of competition.
According to the local planning authority, because of a change in the traffic routes within the city centre of Bad Aibling, residents from the west have to bypass the city centre and drive through southern Bad Aibling
to get to Kaufland. Accordingly, a new supermarket has been discussed.
Given the relatively few competitors within the catchment area and the forecasted population growth for the county (“Landkreis”) of 7.5% between years 2009 and 2025, we rate the overall current competitive
environment as medium.
Turnover analysis
For the purpose of this valuation, we have used the average turnover rents for the years 2008 and 2009 until the end of the respective lease agreement. The rents in functional retail agglomerations are linked to
turnover. The percentage that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate normally ranges between 2% and 15% depending on the
respective branch. Kaufland is a very strong anchor, we believe that there will continue to be demand for ancillary tenants. For Kaufland, we have been provided with turnover figures. We have analysed the figures
and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store.
Hence, we believe that a higher market rent is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.”
Conclusion
The property is currently mainly used as a self-service department store (Kaufland), which makes up 52% of lettable area. AWG (discount fashion) makes up 14% of the total lettable area, a dm-markt (drugstore)
makes up close to 10% and the rest is divided between smaller retailers within the retail park. An outside parking lot offers sufficient parking. The property is also easily accessible via public transport. Despite the
relatively small primary catchment area, because there are few direct competitors and the population growth for the county (“Landkreis”) is forecasted to grow by 7.5% between years 2009 and 2025, we anticipate
that there will be enough customers to sustain the property. At the time, there is no vacancy. Kaufland, being a consumer magnet, provides a healthy retail environment for the remaining tenants.
The lease of the anchor tenant (Kaufland) does not expire until 2022 and it has options to extend until 2037. On the basis of our projection of likely productivity per m² and turnovers, we have calculated the market
rent at a level of € 6.50 /m²/month. The tenant currently pays a contractual rent of € 5.25 /m²/month. Therefore, we expect that Kaufland will stay until 2037 (based on its below-market rental level), as long as it
continues to generate adequate turnover. Potential future uses for the property would be difficult to envision. The best use for the property is its current use as a self-service department store. The next self-service
department store is located in the next town, approx. 6km away. If Kaufland were to leave, another self-service department store, such as a real,- or Marktkauf, would be likely to take its place.
Page 5 of 12
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Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 AWG Allgemeine Warenvertriebs-GmbH
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
998
€ 10,558
10.57
Yes
24.02.2000
30.06.2015
2 Telko GmbH
Retail
Let
77
€ 1,208
15.78
Yes
15.03.2005
30.03.2016
75%
3 Pham
Retail
Let
84
€ 1,000
11.96
Yes
01.07.2011
30.06.2016
75%
75%
GT I PM
4 Reno Sportswear GmbH
Retail
Let
224
€ 1,141
5.10
n.a.
01.01.2012
31.12.2016
75%
M GT I PM
5 dm-drogerie markt GmbH + Co. KG
Retail
Let
709
€ 6,979
9.84
Yes
10.02.2000
31.12.2014
75%
6 Heinrich Deichmann Schuhe GmbH & Co. KG
Retail
Let
498
€ 5,158
10.35
Yes
21.02.2000
20.02.2015
75%
75%
GT I PM
7 Fressnapf Immobilien-Vermögensverwaltung GmbH
Retail
Let
346
€ 2,164
6.25
Yes
11.02.2000
10.02.2015
Retail
Let
404
€ 4,168
10.30
Yes
01.03.2000
28.02.2015
75%
9 Handelshof SB Warenhaus GmbH & Co. KG
Retail
Let
3,634
€ 19,086
5.25
Yes
01.10.2007
30.09.2022
75%
Other Units
Let
6
€ 265
44.17
Yes
03.08.2009
02.08.2014
100%
Retail
Let
78
€ 604
7.71
n.a.
01.12.2011
30.11.2016
75%
M GT I PM
Other Units
Let
1
€ 672
672.00
00.01.1900
31.12.2023
100%
M GT I PM
External parking
Let
300
€0
0.00
01.10.2007
31.12.2023
100%
7,053 m²
€ 53,002
11 Fechtel
12 Kiosk
13 External Parking
Total
No
Page 6 of 12
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Area Category
Area
sqm/unit
Retail
998
2 Telko GmbH
Retail
77
3 Pham
Retail
84
€ 11.00
4 Reno Sportswear GmbH
Retail
224
€ 11.00
Tenant Name
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Agency
Fees*
Lease
Term**
Renewal
Probability
€ 10.00
€ 9,984
€ 50
0
12
€ 11.00
€ 842
€ 100
0
12
€ 919
€ 100
0
12
0
2
5
25%
0
2
5
25%
0
2
5
€ 2,460
€ 100
0
25%
12
0
2
5
25%
Rent
Abatem.*
Retail
709
€ 10.00
€ 7,090
€ 100
0
12
0
2
5
25%
6 Heinrich Deichmann Schuhe GmbH & Co. KG
Retail
498
€ 10.00
€ 4,981
€ 100
0
12
0
2
5
25%
Retail
2
346
€ 6.50
€ 2,252
€ 100
0
12
0
Retail
404
€ 10.00
€ 4,045
€ 100
0
12
0
2
5
25%
Retail
3,634
€ 6.50
€ 23,622
€ 50
0
12
0
2
10
25%
Other Units
6
€ 265.00
€ 1,590
€0
0
0
0
0
5
0%
Retail
78
€ 11.00
€ 861
€ 100
0
12
0
2
5
25%
Other Units
1
€ 672.00
€ 672
€0
0
0
0
0
10
0%
External parking
300
€ 0.00
€0
€0
0
0
0
0
0
0%
11 Fechtel
12 Kiosk
13 External Parking
Total
* months
7,053 sqm
** years
5
25%
€ 59,319
Page 7 of 12
.
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
7,053
0
0
0
0
0
7,053
0
7
0
300
307
Area Vacant
m²
0
0
0
0
0
0
0
0
0
0
0
0
0
Area Let
m²
0
7,053
0
0
0
0
0
7,053
0
7
0
300
300
Vacancy Rate
%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
7.38
0.00
0.00
0.00
0.00
0.00
0.00
133.86
7.52
0.00
0.00
Contractual
Rent
€/month
0
52,065
0
0
0
0
0
0
937
53,002
0
0
Contractual
Rent
€/year
0
624,781
0
0
0
0
0
0
11,244
636,025
0
0
Potential
Rent
€/year
0
624,781
0
0
0
0
0
0
11,244
636,025
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
8.09
0.00
0.00
0.00
0.00
0.00
0.00
133.86
8.22
0.00
0.00
Market
Rent
€/year
0
684,686
0
0
0
0
0
0
11,244
695,930
0
0
Market
Rent
€/month
0
57,057
0
0
0
0
0
0
937
57,994
0
0
Over-/ UnderRented
0.0%
-8.7%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
-8.6%
0.0%
0.0%
Space productivity
7,000
Explanation
8.00
7.45
6,500
Market rent
7.00
6,000
Contractual Rent
6.50
6.00
Rent / m² / month
5,500
5,000
4,500
Rents
5.58
5.25
5.00
4.00
3.72
4,000
%
€ / m²
Contractual
2.8%
5.25
Market
3.5%
6.50
4% of turnover
7.45
3% of turnover
5.58
3.72
2% of turnover
3.00
3,500
Turnover potential
8,118,378 €
(net)
Sales Area
3,000
3,247
2.00
1.0%
in € / m² p.a.
1.5%
based on sales area
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 2,500 m²
3,634 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Vertrieb 84 GmbH & Co. KG
€ 229,028
36%
8.7 years
n.a.
1AA 2
2
76
€ 560,000 (single) € 39,000,000 (total)
area is food retailing with branded goods and own-brands specially produced for Kaufland. According to
Dun & Bradstreet (D&B) rating as at 28.01.2014 Kaufland Vertrieb 84 GmbH & Co. KG (Handelshof SBWarenhaus GmbH & Co. KG) has a below-average credit risk. The risk of insolvency (D&B Score) within
the next 12 months compared with other German companies is assessed to be low, i.e. 76% of
businesses on the German database have the same or higher risk of failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
3
Market Value
The property is let to ten retail tenants. There is no vacancy at the moment. The WALT amounts to 4.1 years. The main tenant is Kaufland with a share of approx. 36% of the rental income. The property is currently
under-rented mainly due to a very low rental level of the main tenant Kaufland. As the lease contract is valid until 2022 and the tenant has extention options until 2037, we do not believe that the rental level can be
adjusted before 2037. The rent of Kaufland is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 % in relation to the CPI basis. Indexation started on 01.08.2008. Ground tax,
maintenance costs for structural repairs, management and insurance costs are not borne by Kaufland. The rest can be apportioned to the tenant in accordance with the German Regulation on Operating Costs.
According to the provided documents the main tenant Kaufland shortened its lease contract by 5 years from 2027 to 2022. We are not aware of any other tenants planning to terminate their leases in the subject
property, nor have we received any information regarding a prolongation of their leases.
Discount rate
7.50%
Capitalisation rate
6.75%
vacancy rate as well as the location within the federal state Bavaria.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.35 /m²
€ 3.30 /m²
€ 0.28 /m²
€ 0.00 /m²
€ 10.44 /m²
€ 38,790
€ 9,540
€ 23,307
€ 2,010
€0
€ 73,647
per year
per year
€ 5.50 /m²
€ 1.48 /m²
€ 3.30 /m²
€ 0.28 /m²
€ 0.00 /m²
€ 10.57 /m²
€ 38,790
€ 10,439
€ 23,307
€ 2,010
€0
€ 74,546
Inflation
% of Gross
Contract Rent
6.10%
1.50%
3.66%
0.32%
0.00%
11.58%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.57%
1.50%
3.35%
0.29%
0.00%
10.71%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 38,790
€ 39,410
€ 40,112
€ 40,818
€ 41,479
€ 42,135
€ 42,809
€ 43,502
€ 44,190
€ 44,844
€ 45,498
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 9,627
€ 8,483
€ 9,614
€ 9,861
€ 10,005
€ 10,005
€ 8,912
€ 10,620
€ 9,633
€ 11,046
€ 11,046
Insurance
Costs
€ 2,010
€ 2,042
€ 2,078
€ 2,115
€ 2,149
€ 2,183
€ 2,218
€ 2,254
€ 2,290
€ 2,324
€ 2,358
Ground
Tax
€ 23,307
€ 23,680
€ 24,101
€ 24,526
€ 24,923
€ 25,317
€ 25,722
€ 26,138
€ 26,551
€ 26,944
€ 27,338
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 73,734
€ 81,124
€ 76,387
€ 78,045
€ 78,556
€ 79,640
€ 87,818
€ 82,963
€ 93,874
€ 85,158
€ 86,240
Vacancy
Costs
€0
€ 7,509
€ 482
€ 725
€0
€0
€ 8,157
€ 449
€ 11,210
€0
€0
% of Total
Gross Revenue
11.5%
14.3%
11.9%
11.9%
11.8%
11.9%
14.8%
11.7%
14.6%
11.6%
11.7%
16.0%
14.8%
14.3%
14.6%
14.0%
12.0%
11.5%
11.9%
11.9%
11.8%
11.9%
11.7%
11.6%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Cash Flow
3
Market Value
Rental
Revenue
€ 641,816
€ 652,478
€ 647,333
€ 666,974
€ 666,999
€ 666,999
€ 688,897
€ 713,961
€ 735,318
€ 736,375
€ 736,375
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
€0
-€ 86,916
-€ 6,414
-€ 9,590
€0
€0
-€ 94,743
-€ 5,993
-€ 93,129
€0
€0
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 641,816
€ 565,562
€ 640,919
€ 657,384
€ 666,999
€ 666,999
€ 594,154
€ 707,968
€ 642,189
€ 736,375
€ 736,375
Nonrecoverable
Costs
-€ 73,734
-€ 81,124
-€ 76,387
-€ 78,045
-€ 78,556
-€ 79,640
-€ 87,818
-€ 82,963
-€ 93,874
-€ 85,158
-€ 86,240
Net
Operating
Income
€ 568,082
€ 484,438
€ 564,532
€ 579,339
€ 588,443
€ 587,359
€ 506,336
€ 625,005
€ 548,315
€ 651,217
€ 650,135
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
€0
€0
€ 568,082
-€ 62,415
-€ 14,522
€ 407,501
-€ 4,140
-€ 920
€ 559,472
€ 569,643
-€ 7,943
-€ 1,753
€0
€ 588,443
€0
€0
€0
€ 587,359
-€ 10,229
€ 442,083
-€ 54,024
€ 602,788
-€ 16,143
-€ 6,074
-€ 2,427
-€ 10,979
€ 534,909
-€ 52,516
-€ 11,456
€ 587,245
€ 9,631,644
€0
€0
Present
Value @
7.50%
€ 549,544
€ 365,993
€ 468,546
€ 443,340
€ 426,353
€ 395,876
€ 277,928
€ 351,273
€ 291,163
€ 295,294
€ 4,673,215
€ 8,538,525
€0
€ 8,538,525
9.0%
€ 800000.0
7.6%
€ 700000.0
6.6%
€ 600000.0
6.8%
6.9%
6.9%
7.0%
6.4%
5.9%
6.0%
5.7%
€ 500000.0
5.0%
€ 400000.0
4.0%
Running yield
Rental income
8.0%
7.3%
6.7%
€ 300000.0
3.0%
€ 200000.0
2.0%
€ 100000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 636,025
€ 7.52
Market rental value
total p.a.
per m²/month
€ 695,930
€ 8.22
-8.61%
Over-/Underrent
Year 8
Total
€ 8,500,000
per m²
€ 1,205
Purchaser's costs
5.25%
Yield Overview
Net Initial Yield
6.62%
7.31%
Gross Initial Yield
7.85%
8.59%
Total
€ 8,100,000
per m²
€ 1,148
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 28.01.2014, the main tenant Handelshof SB-Warenhaus GmbH & Co. KG has good covenant
strength, which ensures a secure cash flow for the remainder of the lease term until at least 2022. Upon resale we took into account such facts as visibility, demographic factors, appearance, condition and building
age, third party usability, competition and location. For the purpose of the valuation on 31.12.2013, we have not been provided with a new non-recoverable costs schedule by the asset manager.Therefore we have
remained all non-recoverable service charges unchanged and have been applied according to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the
effective gross rent.
Regarding comparable rents, we have evidence of similar areas situated in comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the section "Investment
Comparables". We have been provided with updated information regarding necessary capital expenditures. Upon resale we took into account such facts as visibility, demographic factors, appearance, condition
and building age, third party usability, competition and location.
The following changes have taken place compared with 31. March 2013: Kaufland has shortened its lease contract by 5 years to 2022 and therefore the remaining lease term is 2.4 years shorter (4.1). In addition no
material changes took place. Due to the above mentioned facts, the discount rate has been raised by 60 bps. As a result, the Market Value is decreased by 4.7%.
Page 10 of 12
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Photos
Internal view of entrance area of Kaufland
View of bakery in entrance area to Kaufland
View of vacant area
View of parking lot and retail park
Page 11 of 12
abc
Property address
Property no.
3
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
83043 Bad Aibling
Inspection date:
31.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Real
Real
Kaufland
dm-drogerie markt
Rossmann
Deichmann
KiK
0
City
Amberg
Zschornewitz
Freital
Landsberg am Lech
Treuchtlingen
Karlstadt
Bad Kissingen
0
Property Type
Drugstore
Drugstore
Shoe store
Discount Fashion
0
Area
10,824 m²
1,000 m²
8,000 m²
831 m²
531 m²
467 m²
525 m²
0 m²
Total Rent p.m.
€ 71,114
€ 7,410
€ 62,000
€ 6,440
€ 5,193
€ 4,651
€ 5,119
€0
Rent p. sqm
€ 6.57 /m²
€ 7.41 /m²
€ 7.75 /m²
€ 7.75 /m²
€ 9.78 /m²
€ 9.96 /m²
€ 9.75 /m²
€ 0.00 /m²
Comment
Slightly lower purchasing power
Other federal state
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
4
Property Summary
Key Figures
Property type
Main tenant
Retail Park
& Co. KG (Marktkauf Autonom BM Vermietungs GmbH & Co. KG)
Total lettable area
Total parking units
10,769 m²
606 units
0.0%
7.2 years
1994
n.a.
total p.a.
per m² / month
€ 1,262,394
€ 9.77
total p.a.
per m² / month
€ 82,109
€ 0.64
total p.a.
per m² / month
€ 1,180,286
€ 9.13
total p.a.
€ 1,282,235
-1.5%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Good tenant mix
Good connections to the major roads B 465 and L 267
0
Limited third party usability of the large-scale retail area without refurbishment
Building almost 20 years old
0
0
0
Opportunities
Threats
Extension of the lease contracts of the smaller tenants
Finding new strong and attractive tenants
Prolognation of the lease contract after expiry
Development of the surplus-land
0
Increasing maintenance required due to the building age
Drop out of tenants before expiry of the contracts
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
2
3
3
3
16 to 25 years
Between 10,000 and 12,500 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
3
3
3
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The property is a one-storey retail building with parking facilities on the roof. The petrol station and some undeveloped areas are located on separate plots. The ground level of the retail building is occupied by
several retail tenants.The main tenant is Handelshof. The main entrances are accessible from the parking areas and located on the south side of the building. Another entrance to the retail areas is on the roof
beside the parking facilities. Access to the parking areas on the roof is made possible via a ramp along the west facade. The property can be easily reached from Obere Stegwiesen. Structurally, the building
consists of a steel-beton construction. The main entrance is equipped with glazed elements and the entrance is provided by automatic sliding doors.
Valuation Results
Market Value
€ 15,800,000
equals to
Market Rental Value
€ 1,449 per m²
€ 1,282,235 p.a.
Discount Rate
7.10%
Net Initial Yield
7.11%
Capitalisation Rate
6.75%
7.23%
excluding
capital
expenditures
Page 1 of 12
€ 9.92 / m² / p.m.
equals to
7.01%
12.36
7.13%
12.17
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Location
Germany
Baden-Wurttemberg
Biberach (Rural District)
Biberach
88400
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Biberach
10,786,227
189,523
32,360
15,040
134
448
2.5%
0.3%
0.8%
3.9%
2.6%
District
City
Federal State
District
District
in m €
in m €
index
index
index
4,164
784
107.20
117.43
77.03
Macro Location
Biberach an der Riß is located in the south-east of the federal state Baden-Wurttemberg. The closest
major cities are Memmingen (approx. 43 km south-east; 41,085 inhabitants) and Ulm (approx. 47 km
north-east; 122,000 inhabitants).
The closest motorway is the A7, connecting to Flensburg (near the Danish border) in the north and to
Füssen (close to the Austrian border) in the south, can be reached in a distance of approx. 33 km.
Furthermore, the A8, connecting to Munich and farther on, Austria in the south-east and to Perl near the
French border in the north-west, can be reached in a distance of approx. 47 km.
Biberach has a train station, which connects Biberach to the cities of Stuttgart and Munich via regional
trains. The nearest airport offering connections to national and international destinations is
Friedrichshafen, located approx. 67 km from the city centre of Biberach an der Riß. Furthermore, the
Stuttgart Airport is located approx. 136 km away and the Munich Airport is situated approx. 151 km
away.
Biberach an der Riß is a strong business location. The city has both known and globally-operated large
corporations, as well as many mid-size industrial and trading companies. Well-known companies in
Biberach an der Riß are Liebherr, Boehringer Ingelheim, Handtmann, EnBW and KaVo. Furthermore,
Biberach is also known for its university, Biberach University of Applied Sciences.
Micro Location
Micro Location
The property is located in the north-east of the city and is less than 4 km from Biberach city centre. The
property itself is located on a side road near the B 465, L 251 and L 267; it is bordered by industrial and
trading companies.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
300
5.0
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
26,342 m²
2,298 m²
Ground lease
No
n.a.
Ground lease expiry
€ 100 /sqm
€ 229,800
Site servicing
Site layout
Fully serviced
3003/2: trapezoidal, 3002: trinagular, 3002/1: square
Soil contamination
No Suspicion
Yes
Comment
The site consists of three separate pl. 3003/2 and 3002 : all have an even topogr. It can be accessed fr.
the western side by foot or fr. the eastern side by car. According to the Environmental Due Diligence
report, dated July 2007, the site is not registered in the register of contaminated sites. According to the
land charges register of Biberach (page 2500 nr.1) one building encumbrance exists reg. t. limited sales
areas (max. 9,500m²) a. t. product ranges. Furthermore, areas for admin. a. parking spaces must be
built. For purposes of this valuation, we assume that the building encumbrances have no effect on the
valuation. For the purposes of this valuation, we have assumed that the subject property is free of any
soil or building conta. For purpose of this valuation, we assumed the land value pursuant to the
committee of experts of Biberach.
Town Planning
Use class
SO (special zone)
0,8
Plot ratio (GFZ)
2.4
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority, a development plan exists, entitled "Obere
Stegwiese 332" and dated 11.11.1995, with the following regulations: the subject site is located in
special zone ("Sondergebiet"). The plot ratio (Geschossflächenzahl, GFZ) is 2.4 and the site coverage
ratio (Grundflächenzahl, GRZ) is 0.8.
Tenure
Land Register
Owner
Local Court of Biberach TPL Biberach S.á.r.l.,
an der Riß, land register Luxembourg
of Biberach an der Riß
Sheet
12876
Plot
SO 3849, SO
3849 (VN
2008/71)
Parcel
3003/2, 3002
Section 3 (Loans)
2 easements. 1. for t. owner o. t. prop. parc. 49
Bahnhofstr. 2 a. parc. 55 Bahnhofstr. 1 with
49,50a (reg. t. rig. o. water pipe). 2. i. favr. o. t.
Frankfurt, 11th May 2011.
owner o. t. parc. 775, Eisenbahn EB 1 a. parcel
2997, 2998, 2999, 3000, 3001, 3025, 3026, 3027,
3028 a. 3029 (reg. t. rig. o. wayleave). Limited
personal easements. 1. (reg. o. t. clamping
station, power line a. access) in favr. o. t. EnergieVersorgung Schwaben AG, 2. (reg. o. t. retain a.
operate o. a hypermar.) i. favr. o. Kaufland
Dienstl. GmbH Co. KG Neckarsulm. Rig. o.
acquisition i. favr. o. alb-elektric OHG located i.
Biberach. Restrictive covenant, 1.i. favour of t.
particular owner for t. parcel 3003/2, 2. favour o.
Kaufland Dienstl. GmbH Co. KG Neckarsulm
(reg. t. durable omission reg. operate o. f. exa.
discoun., supermar. o. eating house)
Source: Extract from the land register dated 14.01.2014
Page 3 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Marktkauf
Obi
Type
Hypermarket
DIY
Address
88400 Biberach, Sandgrabenstr. 52
88400 Biberach, Hubertus Liebrecht-Str. 44
Sales area
2,965 m²
n.a.
Distance
2.00 km
1.50km
Potential
Medium
Medium
0
0
0
0
0
0
0
0
0
0
30,469
33,668
13,998
14,677
2.5%
117.43
77.03
Page 4 of 12
4,164
24,048
2.6%
abc
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
4
Main competitors
This competitor is a retail park located in the north-east of Biberach. The main tenant is OBI. Other
tenants for example are Lidl, a drinks cash-and-carry and Euronics. The retail park "Biber Center" is
well located directly on the main road L 267. The property is a serious competitor.
This competitor is a medium-sized Marktkauf. The location of Marktkauf is very good. It is located
between the main road, L 267, and a residential area. The Marktkauf is a serious competitor.
Competition Comment
Catchment area is divided into 2 categories: primary (5 km radius) and secondary (10 km radius). Approximately 30,500 inhabitants live in the primary catchment area. While the density of hypermarkets is relatively
high in the primary catchment area, the competition eases in the secondary catchment area. Even though there are several discounters and small-sized supermarkets located in Biberach, it can be said that these
present only indirect competition to the property. Kaufland offers a very deep and broad product range with more than 50,000 products, while discounter and supermarkets offer a limited product range with only
7,000 to 11,000 (supermarkets) or 400-2,500 (discounters) articles. Therefore, these retailing forms address different customers or customer needs. While supermarkets and discounters cater to the daily needs of
customers, Kaufland offers a larger variety of products that are bought on a non-daily basis. There are two direct competitors within 2 km.
The first competitor, a retail park called “Biber Center” is located in a distance of 1.5 km directly on the main road L 267. The location of this centre compared to our centre is better, as it is can be accessed directly
from the L 267 and is therefore very visible. The Biber Center seems to be newer and has a good mix of tenants. The main tenant is an OBI market; other tenants include Lidl, a drinks cash-and-carry, Burger King
and Euronics. The Biber Center has no supermarket, just a Lidl discounter, which offers another product range. In addition, the significant difference in size and product range also differentiates the properties,
especially the DIY stores. The OBI market offers a wider range and is more upscale than the discount DIY at the subject property. Therefore, it can be said that the Biber Center represents only medium competition.
Another direct competitor is Marktkauf, which is 2.0 km away. The Marktkauf is directly located on the main road L 267 and is very visible. However, it can not be directly accessed from the main road; instead, it is
necessary to drive first through a residential area to reach the store.
While the Kaufland is primarily reachable by car, the competitor can also be reached by foot from the adjacent residential area. The Marktkauf probably has similar construction date as the valued property and
offers a similar assortment. The competitor does not offer as many parking facilities as the valued property. The valuation property offers a wide range of products due to the various tenants, while the competitor
has just some minor tenants like a bakery and a hairdresser. Even though the properties may attract different customers and have slightly different primary catchment areas, the catchment areas strongly overlap
and two hypermarket stores for a city of only 32,000 inhabitants can be problematic. Overall, it can be said that the competition level in Biberach is medium to high, especially due to the existence of a similar
Marktkauf nearby.
Turnover analysis
The rents in functional retail agglomerations are linked to turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate
normally ranges between 2% and 15% depending on the respective branch. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m². Kaufland is represents a very strong anchor, we
believe that there will always be demand for such ancillary tenants. We have not been provided with any turnover figures for Kaufland. For Kaufland, we have also been provided with turnover figures. We have
analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service
department store. Hence, we believe that a higher market rent is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.
0
Conclusion
The property in Biberach is located in the direct vicinity of several serious competitors. The property is currently used for retail use; regarding third-party use, retail is the best option, because of the structural
conditions like the very good parking facilities, the allocation and the equipment of the areas of the value property. The strengths of the property include that it is fully let, the well-known status of the main tenant, the
length of the lease contract of the main tenant and the very good parking facilities. In contrast, some weaknesses include the limited third-party usability, the limited visibility and the secluded location as a whole.
The leasing capacity is for this property medium because of the building age and the existing density of competitors.
0
Page 5 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
75%
Tenant
pays *
1 AWG Allgemeine Warenvertriebs GmbH
Retail
Let
1,144
€ 10,863
9.50
Yes
03.11.1994
03.11.2019
Retail
Let
4,150
€ 42,337
10.20
Yes
01.07.1999
30.06.2019
75%
3 Turgay Akkaya
Retail
Let
42
€ 509
12.04
n.a.
19.07.2013
19.07.2018
75%
GT I PM
I
4 Walser + Schwaderer GmbH
Retail
Let
47
€ 2,637
56.10
Yes
01.11.2004
31.10.2014
75%
GT I PM
5 Yilmaz
Retail
Let
44
€ 1,387
31.90
Yes
06.04.2005
05.04.2015
75%
GT I PM
6 Bäckerei Mäschle OHG
Retail
Let
53
€ 7,032
131.69
Yes
01.10.2004
30.09.2019
75%
GT I PM
GT I
7 Cetin
Retail
Let
42
€ 1,176
28.00
n.a.
01.07.2007
30.06.2015
75%
M GT I PM
8 Essanelle Hair Group AG
Retail
Let
31
€ 1,837
58.95
Yes
06.11.2006
05.11.2016
75%
GT I PM
Retail
Let
5,216
€ 28,688
5.50
Yes
01.10.2007
30.09.2027
90%
Other Units
Let
1
€0
0.00
Yes
01.06.2007
30.11.2014
100%
M GT I PM
Other Units
Let
3
€ 133
44.17
Yes
03.08.2009
02.08.2014
100%
M GT I PM
12 Schussenrieder Brauerei
Other Units
Let
1
€ 30
30.00
00.01.1900
31.07.2017
100%
Petrol Station
Let
2,103
€ 7,941
3.78
Yes
01.09.2005
31.08.2015
0%
14 Kiosk
13 HPV Hanseatic Petrol Vertriebs GmbH
Other Units
Let
1
€ 472
472.33
Yes
00.01.1900
31.12.2023
100%
15 Turnover rent
Other Units
Let
1
€ 157
157.42
n.a.
00.01.1900
31.12.2023
100%
M GT I PM
External parking
Let
606
€0
0.00
n.a.
00.01.1900
00.01.1900
0%
M GT I PM
12,872 m²
€ 105,200
16 Parkplätze
Total
M GT I
Page 6 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Area Category
Tenant Name
Area
sqm/unit
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
1 AWG Allgemeine Warenvertriebs GmbH
Retail
1,144
€ 9.50
€ 10,863
€ 50
0
12
0
3
10
25%
Retail
4,150
€ 9.50
€ 39,425
€ 50
0
12
0
3
10
25%
3 Turgay Akkaya
Retail
42
€ 25.00
€ 1,057
€ 100
0
15
0
3
5
25%
4 Walser + Schwaderer GmbH
Retail
47
€ 50.00
€ 2,350
€ 100
0
15
0
3
10
25%
5 Yilmaz
Retail
44
€ 25.00
€ 1,088
€ 100
0
15
0
3
5
25%
6 Bäckerei Mäschle OHG
Retail
53
€ 130.00
€ 6,942
€ 100
0
15
0
3
5
25%
7 Cetin
Retail
42
€ 25.00
€ 1,050
€ 100
0
15
0
3
5
Retail
31
€ 50.00
€ 1,559
€ 100
0
15
0
3
10
25%
Retail
5,216
€ 8.00
€ 41,727
€ 50
0
12
0
3
10
10%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
10
0%
Other Units
3
€ 44.17
€ 133
€0
0
0
0
0
10
0%
12 Schussenrieder Brauerei
Other Units
1
€ 30.00
€ 30
€0
0
0
0
0
10
0%
Petrol Station
2,103
€ 0.00
€0
€0
0
0
0
0
0
0%
Other Units
1
€ 472.33
€ 472
€0
0
0
0
0
10
0%
Other Units
1
€ 157.42
€ 157
€0
0
0
0
0
10
0%
External parking
606
€ 0.00
€0
€0
0
0
0
0
0
0%
13 HPV Hanseatic Petrol Vertriebs GmbH
14 Kiosk
15 Turnover rent
16 Parkplätze
Total
* months
12,872 sqm
** years
25%
€ 106,853
Page 7 of 12
.
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
10,769
0
0
0
0
0
10,769
2,103
7
0
606
2,716
Area Vacant
m²
0
0
0
0
0
0
0
0
0
0
0
0
0
Area Let
m²
0
10,769
0
0
0
0
0
10,769
2,103
7
0
606
606
Vacancy Rate
%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
8.96
0.00
0.00
0.00
0.00
0.00
3.78
113.18
9.77
0.00
0.00
Contractual
Rent
€/month
0
96,466
0
0
0
0
0
7,941
792
105,200
0
0
Contractual
Rent
€/year
0
1,157,595
0
0
0
0
0
95,292
9,507
1,262,394
0
0
Potential
Rent
€/year
0
1,157,595
0
0
0
0
0
95,292
9,507
1,262,394
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
9.85
0.00
0.00
0.00
0.00
0.00
0.00
113.18
9.92
0.00
0.00
Market
Rent
€/year
0
1,272,728
0
0
0
0
0
0
9,507
1,282,235
0
0
Market
Rent
€/month
0
106,061
0
0
0
0
0
0
792
106,853
0
0
Over-/ UnderRented
0.0%
-9.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
-1.5%
0.0%
0.0%
Space productivity
7,000
Explanation
14.00
13.00
6,500
6,000
12.00
Market rent
11.00
Contractual Rent
10.00
Rent / m² / month
5,500
5,000
5,287
4,500
12.84
Rents
9.63
9.00
8.00
8.00
7.00
6.42
6.00
5.50
4,000
5.00
2.00
1.0%
in € / m² p.a.
based on sales area
5.50
Market
2.5%
8.00
4% of turnover
12.84
3% of turnover
9.63
Turnover potential
6.42
20,089,294 €
(net)
3.00
3,000
1.7%
2% of turnover
4.00
3,500
€ / m²
%
Contractual
Sales Area
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 3,800 m²
5,216 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
toom Baumarkt Vermietungs GmbH & Co. KG (Marktkauf Auton
€ 344,251
27%
13.7 years
80
HH 2
2
52
€ 15,000
The main tenant toom baumarkt is a corporation belonging ultimately to Rewe Group, which purchased
Marktkauf in 2007. Marktkauf operates self-service department stores and used to operate DIY stores
until 2007, when they sold off about 133 stores to Rewe (toom DIY) and closed the remaining ones. The
Rewe Group is a large German supermarket corporation, currently holding a market share of 15.7% in
food retailing. According to Dun & Bradstreet (D&B) Rating as of 28.01.2014 toom Baumarkt has a low
credit risk. The risk of insolvency (D&B Score) within the next 12 months compared with other German
companies is assessed to be quite low, i.e. 52% of businesses on the German database have the same
or higher risk of failure. In Sep. 2013 the company name changed to toom baumarkt Vermietungs
GmbH & Co. KG.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
4
Market Value
The property is let to nine retail tenants and a petrol station. At the moment the subject property is fully let. The WALT of the property amounts to 7.2 years. The property is almost rack-rented. This figure includes
the turnover rents of the tenants Bäckerei Mäschle, Cetin, HPV Hanseatic, Walser and Yilmaz, which we belive to be sustainable until the end of the respective lease contracts. The property is nearly let at market
rental level. The lease contract of the main tenant expires in 2027. Kaufland’s rent is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI basis.
Indexation started on 01.04.2009. The majority of the tenants pay all costs (including ground tax, insurance costs and management costs) except for maintenance costs for structural repairs.
The rest can be apportioned to the tenants in accordance with the German Regulation on Operating Costs. Furthermore, some rental increases due to indexations have taken place.
According to the provided information Kaufland has extended its lease contract until September 2027.
Discount rate
7.10%
Capitalisation rate
6.75%
account such facts as the short remaining lease term and the lasting condition of the subject property.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 4.50 /m²
€ 1.76 /m²
€ 1.01 /m²
€ 0.36 /m²
€ 0.00 /m²
€ 7.62 /m²
€ 48,460
€ 18,936
€ 10,849
€ 3,864
€0
€ 82,109
per year
per year
€ 4.50 /m²
€ 1.79 /m²
€ 1.01 /m²
€ 0.36 /m²
€ 0.00 /m²
€ 7.65 /m²
€ 48,460
€ 19,234
€ 10,849
€ 3,864
€0
€ 82,406
Inflation
% of Gross
Contract Rent
3.84%
1.50%
0.86%
0.31%
0.00%
6.50%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
3.78%
1.50%
0.85%
0.30%
0.00%
6.43%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 48,460
€ 49,235
€ 50,111
€ 50,993
€ 51,819
€ 52,638
€ 53,480
€ 54,347
€ 55,205
€ 56,022
€ 56,840
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 18,857
€ 18,332
€ 17,854
€ 18,129
€ 18,336
€ 15,858
€ 17,766
€ 18,482
€ 18,600
€ 18,618
€ 18,632
Insurance
Costs
€ 3,864
€ 3,926
€ 3,996
€ 4,066
€ 4,132
€ 4,197
€ 4,265
€ 4,334
€ 4,402
€ 4,467
€ 4,532
Ground
Tax
€ 10,849
€ 11,023
€ 11,219
€ 11,416
€ 11,601
€ 11,784
€ 11,973
€ 12,167
€ 12,359
€ 12,542
€ 12,725
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 82,109
€ 82,885
€ 83,207
€ 84,686
€ 86,039
€ 96,926
€ 89,636
€ 89,330
€ 90,566
€ 91,649
€ 92,729
Vacancy
Costs
€ 79
€ 369
€ 27
€ 82
€ 151
€ 12,449
€ 2,152
€0
€0
€0
€0
% of Total
Gross Revenue
6.5%
6.8%
7.0%
7.0%
7.0%
9.2%
7.6%
7.2%
7.3%
7.4%
7.5%
10.0%
9.2%
9.0%
7.6%
8.0%
7.0%
6.5%
6.8%
7.0%
7.0%
7.0%
7.2%
7.3%
7.4%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,261,883
€ 1,235,713
€ 1,191,884
€ 1,213,503
€ 1,226,946
€ 1,221,770
€ 1,216,044
€ 1,232,145
€ 1,240,013
€ 1,241,172
€ 1,242,108
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 4,766
-€ 13,549
-€ 1,638
-€ 4,927
-€ 4,572
-€ 164,565
-€ 31,655
€0
€0
€0
€0
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,257,117
€ 1,222,164
€ 1,190,246
€ 1,208,576
€ 1,222,374
€ 1,057,205
€ 1,184,389
€ 1,232,145
€ 1,240,013
€ 1,241,172
€ 1,242,108
Nonrecoverable
Costs
-€ 82,109
-€ 82,885
-€ 83,207
-€ 84,686
-€ 86,039
-€ 96,926
-€ 89,636
-€ 89,330
-€ 90,566
-€ 91,649
-€ 92,729
Net
Operating
Income
€ 1,175,008
€ 1,139,279
€ 1,107,039
€ 1,123,890
€ 1,136,335
€ 960,279
€ 1,094,753
€ 1,142,815
€ 1,149,447
€ 1,149,523
€ 1,149,379
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
€0
€0
€ 1,175,008
-€ 3,366
-€ 3,446
€ 1,132,467
€0
€0
€ 1,107,039
€ 1,121,835
-€ 820
-€ 1,235
-€ 1,130
€ 1,134,345
-€ 860
-€ 32,503
-€ 56,348
€ 871,428
-€ 14,770
€ 1,062,735
-€ 17,248
€ 1,142,815
€0
€0
€0
€0
€ 1,149,447
€0
€0
€ 1,149,523
€ 17,027,822
€0
€0
Present
Value @
7.10%
€ 1,139,009
€ 1,025,330
€ 935,424
€ 884,792
€ 835,697
€ 602,237
€ 681,455
€ 685,206
€ 643,583
€ 600,948
€ 8,575,598
€ 16,609,279
€ 244,737
€ 16,854,016
8.0%
€ 1400000.0
7.0%
€ 1200000.0
6.8%
6.6%
6.7%
6.8%
6.7%
6.8%
6.8%
7.0%
6.5%
6.0%
5.7%
5.0%
€ 800000.0
4.0%
€ 600000.0
Running yield
Rental income
€ 1000000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,262,394
€ 9.77
Market rental value
total p.a.
per m²/month
€ 1,282,235
€ 9.92
-1.55%
Over-/Underrent
Year 8
Total
€ 16,900,000
per m²
€ 1,541
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
7.11%
7.23%
Gross Initial Yield
8.09%
8.22%
Total
€ 15,800,000
per m²
€ 1,449
Valuation Comment
In terms of risk, we considered the covenant strength of the tenants as well as the lease duration of the existing contracts. As at 28.01.2014 the main tenant Marktkauf Autonom BM Vermietungs GmbH & Co. KG
has good covenant strength, which ensures a secure cash flow for the remainder of the lease term until at least 2027. In terms of a resale, we took into account such facts as visibility, demographic factors,
appearance, condition and building age, third-party usability, competition situation and location.
unchanged and have been applied according to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent.
The main tenant, Marktkauf Holding GmbH, has good covenant strength and is a subsidiary of Edeka Group. However, the premises are occupied by a subsidiary of REWE (B1). It could not be clearified whether
the premises are sublet with consent of the landlord or were taken over by REWE. For the purpose of this valuation, we assumed that the lease with Marktkauf is still in place and was sublet to REWE with consent
of the landlord. The restrictions of Division II, have no effect on the value of the property. Furthermore, for the purpose of this valuation, we assumed the land value pursuant to the committee of experts in Biberach.
Regarding comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and locations.
Furthermore, we have analysed comparable transactions. Please refer to the section "Investment Comparables".
The following changes have taken place compared with 31. March 2013: Kaufland has extended its lease contract by 5 years to 2027 and therefore the remaining lease term is 0.6 years longer (7.2). The gross
rental income and the market rental income remained unchanged. According to the provided documents the surplus-land is 3,290m² smaller. Therefore the MV including the surplus Land decreased by € 83,512.
Page 10 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Photos
Western front view of the property
Access to the parking areas on the roof
View of the petrol station
View of the DIY market
Internal view of the mall
Internal view of the Kaufland
Page 11 of 12
abc
Property address
Property no.
4
Portfolio:
Matrix Portfolio
Obere Stegwiesen 10
Valuation date:
31.12.2013
88400 Biberach
Inspection date:
28.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
OBI AG
OBI AG
Praktiker
Kaufland
Kaufland
Kaufland
Kaufland
0
City
Rudolstadt
Ottendorf-Ottkrilla
Hillesheim
Moosburg
Freital
Hameln
Schwäbisch Hall
0
Property Type
DIY
DIY
DIY
0
Area
5,358 m²
6,000 m²
5,278 m²
4,165 m²
8,000 m²
4,425 m²
5,850 m²
0 m²
Total Rent p.m.
€ 31,023
€ 28,320
€ 26,284
€ 42,067
€ 62,000
€ 29,692
€ 55,283
€0
Rent p. sqm
€ 5.79 /m²
€ 4.72 /m²
€ 4.98 /m²
€ 10.10 /m²
€ 7.75 /m²
€ 6.71 /m²
€ 9.45 /m²
€ 0.00 /m²
Comment
Other federal state, slightly lower purchasing power
Other federal state
Better purchasing power
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
5
Property Summary
Key Figures
Property type
Main tenant
Retail Park
ALPHA Warenhandel GmbH & Co. KG
Total lettable area
Total parking units
9,524 m²
400 units
0.8%
6.7 years
2003
n.a.
total p.a.
per m² / month
€ 996,674
€ 8.72
total p.a.
per m² / month
€ 87,991
€ 0.77
total p.a.
per m² / month
€ 908,683
€ 7.95
total p.a.
€ 1,226,337
-13.3%
Market rental value
SWOT Analysis
Strengths
Weaknesses
City centre location
All retail areas on ground floor level
Very good accessibility - sufficient parking spaces
Modern retail park with good tenant mix
Strong anchor tenant Kaufland with long term lease contract
No further extension possible
0
0
0
0
Opportunities
Threats
Limited number of competitors in Borken
Positive future population growth prospects for Borken
Low unemployment rate
Extension of lease contracts with short remaining term
Underrent of Kaufland lease, however, difficult to realise potential as extension options are in place
Termination of short term lease contracts with subsequent void periods
0
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
3
2
4
4
11 to 15 years
Between 7,500 and 10,000 m²
Good general impression
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
4
4
4
Good micro location
Low competition level
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The property (completion date 2003) consists of a single-storey L-shaped retail building; on its ground floor, it has several retail units as well as parking areas and substructures on the roof. Main access is provided
from the south side of the building alongside a roofed passageway in front of the building. Approximately 400 parking spaces (470 spaces acc. to the building permit) are located on the inner courtyard to the south
of the building as well as on the roof. Access to the parking facilities on the roof is provided via a ramp along the west facade. The delivery zone is located at the northern side of the building complex. The main
entrance provides access to the large Kaufland unit (approx. 5,500 m²), two medium sized units (Kramer Schuhe 675m² and C&A 350 m²) and a shopping mall with small shops (between 20 - 80 m²). Three
additional shopping units can directly be accessed from outside the building. An escalator connects the ground floor with the parking deck on the roof.
The structure of the building consists of concrete columns in regular grids, pre-cast concrete beams and concrete floor slab. Staircases are of pre-cast concrete elements. The flat roof is constructed as a parking
area with prefabricated slabs on layer insulation. The facades to the east and to the south are constructed as rear ventilated facades with a facing of exposed brickwork. The upper half of the porch is equipped with
a cover of industrial glass. Partitions within the administration and staff areas are from plasterboard. Corridors are equipped with PVC flooring, painted walls and grid ceilings with external lights. The standard office
shows carpet flooring, painted walls and a suspended grid ceiling with external lights. The complex has a gas-powered heating system with ventilation systems, air heaters and standard heaters.
Valuation Results
Market Value
€ 14,800,000
equals to
Market Rental Value
€ 1,554 per m²
€ 1,226,337 p.a.
Discount Rate
7.15%
Net Initial Yield
5.79%
Capitalisation Rate
6.50%
7.23%
excluding
capital
expenditures
Page 1 of 12
€ 10.73 / m² / p.m.
equals to
5.79%
14.85
7.23%
12.07
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Location
Germany
North Rhine-Westphalia
Borken (Rural District)
Borken
46325
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Borken
17,841,956
369,107
40,968
17,293
260
268
1.9%
-1.1%
0.6%
8.1%
4.2%
District
City
Federal State
District
District
in m €
in m €
index
index
index
7,091
823
100.30
97.37
94.42
Macro Location
Borken is situated in the federal state of North Rhine-Westphalia in the region of Münsterland close to
the Dutch border and has a population (city) of approx. 41,000. It is located about 30 km north of the
large agglomeration area 'Ruhrgebiet', which has approx. 10 million inhabitants (nearby cities include
Duisburg, Oberhausen, Essen Gelsenkirchen and Dortmund). The A3 and A31 federal motorways can
be accessed within a distance of 5 - 10 km from Borken. Immediate access is possible to the B67 and
B70 federal roads.
The city’s train station is linked to the regional railway network. The nearest station connected to the ICE
high-speed train network is located in, for example, Duisburg about 40 km away.
The closest passenger airport, Düsseldorf International, can be reached in a distance of approx. 80 km
south or Münster-Osnabrück International in 80 km north. The economy of Borken (within the rural
region Münsterland) is primarily characterised by small- and medium-sized companies active in various
sectors, as well as handcraft sector. Historically, the textile industry was – and still is – an important
factor in the region. Borken also somewhat benefits from the strategic location between the Netherlands,
Münster and the Ruhrgebiet. Thus, the region is also attractive for logistics companies and related
service providers.
Micro Location
Micro Location
The property is located on the boundary of the city centre of Borken on a highly frequented throughroad, Heidener Strasse, and can directly be accessed from a traffic circle. The surrounding area is
characterised by a mixture of retail, office, industrial and residential buildings. To the east, the building
adjoins Heidener Strasse; to the north, an access road for fire fighting vehicles can be found; and to the
west, the complex is bordered by a public walkway open for pedestrians and bicycles.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
441
5.0
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
17,337 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
Suspicion of contamination
No
Comment
The site has an even topography and is accessible from the east, south and west (pedestrians only).
According to the Environmental DD Report from Mace GmbH, dated July 2007, the risk of subsoil /
ground water contamination is considered moderate to high. Land use risk for present use of the site,
however, is low, if good operation practices can be observed. Furthermore, it is stated that the
environmental setting risk is low to moderate with regards the surroundings of the site and high with
regards to the aquifer and the brook. Overall, Mace estimates the environmental risk to e moderate to
high. No cost estimates for potential decontamination measures were provided to us. For the purposes
of this valuation, we have assumed that the subject property is free of any soil or building contamination.
Town Planning
Use class
MK (core zone)
1.0
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority, a legally binding development plan exists,
entitled "Am Kuhn - No. BO58,2" and dated 31.05.1976, with the following regulations: the subject site is
designated as core area - "MK - Kerngebiet". The maximum height of the buildings is limited to two full
storeys - 60m above sea level. The permissible site coverage ratio amounts to 1.0.
Tenure
Land Register
Local Court of Borken,
land register of Borken
Owner
TPL Borken S.a.r.l.,
Luxemburg
Sheet
15495
Plot
007
Parcel
472
Section 3 (Loans)
Several limited personal easements (regarding
wayleave and pipeline easements, use of parking favour of COREAL CREDIT BANK Aktiengesellschaft
areas, commercial limitation) in favour of the city Frankfurt, 11th May 2011.
of Borken
pipeline easements and operation of a electrical
substation) in favour of the Stadtwerke
Borken/Westf. GmbH, Borken
Limited personal easement to operate a
hypermarket / self-service department store on
the plot, including right of use for all technical
installations and pipelines in favour of Kaufland
Dienstleistungs GmbH & Co. KG, Neckarsulm.
Source: Extract from the land register dated 14.01.2014
Page 3 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
K+K Markt
E-center Wilger
E-center Wilger
0
Type
Hypermarket
Hypermarket
Hypermarket
Address
46325 Borken, Nordring 70-74
46325 Borken, Otto-Hahn-Str. 8
46325 Borken, Boumannstr. 6
0
Sales area
1,819 m²
2,200 m²
3,000 m²
m²
Distance
0.80 km
1.10 km
1.20 km
0.00 km
Potential
Medium to low
Medium to low
Medium to low
0
0
0
0
0
0
0
0
0
30,177
35,830
12,737
14,742
1.9%
94.42
97.37
Page 4 of 12
7,091
20,074
4.2%
abc
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
5
Main competitors
This competitor is a K+K hypermarket with a sales area of 1,990 m² and some additional small
ancillary shops, e.g. Ernsting's family (textile) or Ebbing (bakery). The building is situated
approximately 800 m north-west of the Kaufland asset. Although the asset is highly visible and
located on the main road, Nordring, this property appeared to be less frequented during the
inspection.
This competitor is an E-center Wilger hypermarket with a sales area of 3,000 m² and some additional
small ancillary shops. The building is situated approximately 1.2 km to the north-west of the Kaufland
asset. Upon inspection, this property was highly frequented. The property is slightly set back from the
main road Nordring and accessible via Burloer/ Boumannstrasse, but has a modern, attractive
appearance.
Competition Comment
Catchment area is divided into 2 categories: primary (5 km radius) and secondary (10 km radius). Approximately 30,200 inhabitants live in the primary catchment area. This results in approx. 7,600 inhabitants per
large-scale hypermarket in the primary catchment area. The total catchment area (10 km radius) amounts to approx. 35,800 inhabitants (i.e. 9,000 per large scale hypermarket).
Even though there are several discounters and small-scale supermarkets located nearby (4 in primary catchment area), it can be said that these represent only indirect competition for the property. Kaufland offers a
very deep and broad product range with more than 50,000 products, while supermarkets and discounters generally offer a limited product range with only 7,000 to 11,000 (supermarkets) or 400-2,500 (discounters)
items. Therefore, these retailing forms address different customers or customer needs. While supermarkets and discounters cater to the daily needs of customers, Kaufland offers a larger variety of products that
are bought on a non-daily basis.
The main competitors for the Kaufland store in Borken are the K+K Markt as well as two E-center Wilger hypermarkets, all within the primary catchment area. However, due to the smaller size, retail concept and
partly weaker micro-location, the competition potential of these markets is fairly limited. No other large scale hypermarket is situated in a 15 minute driving distance. For the other retailers in the subject retail park
such as textile and shoe shops, the retail area in the city centre of Borken (only in walking distance) can be regarded as the main competitor.
Turnover analysis
The rents in functional retail agglomerations are linked to turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate
normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² up to more than € 10,000/m². For the shoe and clothing segment, the rent amounts
to approx. 6.0 to 12.0% of the respective turnover – a substantial amount. For Kaufland, we have been provided with turnover figures. We have analysed the figures and have found the area productivity of
Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store. Hence, we believe that a higher market
rent is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.
0
Conclusion
The subject property is a modern self-service department store with a small mall and some additional medium sized tenant units. As Kaufland is a strong customer magnet, we believe that it is possible to re-let the
small retail units on the ground floor without longer void periods. The tenant mix shows a reasonable structure. Furthermore, the property offers sufficient parking spaces in a city centre location. The rental area of
Kaufland itself can be regarded as relatively unproblematic. First of all, the location is suitable for the tenant. It can be reached by foot from the surrounding residential area as well as by car or public transport. The
density of self-service department stores in the primary catchment area is low and there are no other direct competitors within 5 to 15 minutes distance. We believe that Kaufland will be able to compete with these
other hypermarkets, especially because it can operate on a very low contractual rent for a long time.
The anchor tenant, Kaufland, has a lease contract until 2022 with three options each for five years, bringing the earliest possible termination date for the landlord to 2037. On the basis of our projection of likely
productivity per m² and turnovers, we have calculated the market rent at a level of € 7.75/m²/month (please refer to page 8). The tenant currently pays a contractual rent of € 5.47/m²/ month. Therefore, the retail unit
is currently heavily under-rented. Due to the margins realizable and under the assumption of good turnover figures, we believe that Kaufland will remain in the property until 2037.
In the unlikely case that Kaufland should vacate the premises, the property could be relet to other self-service department stores, which are currently not present in the Borken real estate market, such as real or
Marktkauf. Reletting the unit as a DIY store would be difficult, because of the relatively small size of the lettable area and the parking spaces not being on ground level.
Page 5 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Vacant
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Vacant
80
€0
2 ALPHA Warenhandel GmbH & Co. KG
Retail
Let
5,495
€ 30,068
5.47
Yes
01.10.2007
30.09.2022
90%
3 Kramer Schuhe GmbH & Co. KG
Retail
Let
676
€ 8,725
12.92
0.00
Yes
25.09.2003
31.12.2018
75%
GT I PM
4 PM Service GmbH
Retail
Let
30
€ 744
24.86
Yes
01.03.2004
31.08.2014
75%
GT I PM
5 Nguyen - Asian Food
Retail
Let
63
€ 1,930
30.62
Yes
01.08.2010
30.06.2014
75%
GT I PM
6 Reisecenter alltours GmbH
Retail
Let
49
€ 653
13.22
Yes
01.11.2004
21.10.2015
75%
GT I PM
7 Sparkasse Westmünsterland
Retail
Let
28
€ 771
27.99
Yes
01.10.2003
30.09.2014
75%
GT I PM
8 Takko Holding GmbH
Retail
Let
621
€ 7,803
12.57
Yes
23.09.2003
22.09.2023
75%
GT I PM
9 Bott
Retail
Let
31
€ 630
20.13
Yes
01.03.2011
28.02.2014
75%
GT I PM
10 Nyguen - Nail Studio
Retail
Let
36
€ 690
19.17
Yes
01.11.2011
30.10.2014
75%
GT I PM
11 Adler Mode GmbH
Retail
Let
1,602
€ 13,735
8.57
Yes
01.12.2011
30.11.2021
75%
GT I PM
12 C&A Mode KG
Retail
Let
359
€ 4,645
12.92
Yes
28.10.2003
15.08.2015
75%
Other Units
Let
1
€ 88
88.33
Yes
03.08.2009
02.08.2014
100%
14 Friseur Klier GmbH
Retail
Let
81
€ 2,738
33.63
Yes
01.02.2012
31.01.2022
75%
GT I PM
Retail
Let
36
€ 1,070
29.72
Yes
08.10.2003
07.10.2015
75%
GT I PM
16 Dogan
Retail
Let
50
€ 1,151
23.01
Yes
01.11.2005
31.10.2014
75%
GT I PM
17 Dogan
Retail
Let
46
€ 1,006
22.07
Yes
27.02.2004
31.07.2014
75%
GT I PM
18 Ernsting´s family GmbH & Co. KG
Retail
Let
144
€ 2,860
19.84
Yes
25.09.2003
31.12.2017
75%
GT I PM
GT I PM
Retail
Let
35
€ 400
11.42
Yes
15.09.2004
31.12.2017
75%
Other Units
Let
1
€0
0.00
Yes
01.06.2007
30.11.2014
100%
21 Le Thahn Ha
Other Units
Let
1
€ 500
500.00
Yes
01.04.2011
31.03.2014
100%
Retail
Let
62
€ 1,148
18.52
Yes
01.03.2013
28.02.2015
75%
Other Units
Let
1
€ 1,171
1171.00
Yes
01.11.2008
31.12.2023
90%
00.01.1900
31.12.2023
90%
No
01.02.2010
31.12.2023
100%
22 Almaz Mode & Mehr
23 Kiosk
24 Turnover Rent
25 External Parking
Other Units
Let
1
€ 532
532.00
External parking
Let
400
€0
0.00
9,524 m²
€ 83,056
Total
GT I PM
M GT I PM
Page 6 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Area Category
Tenant Name
1 Vacant
Area
sqm/unit
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
Retail
80
€ 80.00
€ 6,437
€ 100
6
12
0
3
5
100%
2 ALPHA Warenhandel GmbH & Co. KG
Retail
5,495
€ 7.75
€ 42,585
€ 50
0
12
0
3
10
10%
3 Kramer Schuhe GmbH & Co. KG
Retail
676
€ 13.00
€ 8,782
€ 100
0
12
0
3
5
25%
4 PM Service GmbH
Retail
30
€ 25.00
€ 748
€ 100
0
12
0
3
5
25%
5 Nguyen - Asian Food
Retail
63
€ 25.00
€ 1,575
€ 100
0
12
0
3
5
25%
6 Reisecenter alltours GmbH
Retail
49
€ 13.00
€ 642
€ 100
0
12
0
3
5
25%
7 Sparkasse Westmünsterland
Retail
28
€ 25.00
€ 688
€ 100
0
12
0
3
5
Retail
621
€ 13.00
€ 8,067
€ 100
0
12
0
3
5
25%
9 Bott
Retail
31
€ 25.00
€ 783
€ 100
0
12
0
3
5
25%
10 Nyguen - Nail Studio
Retail
36
€ 25.00
€ 900
€ 100
0
12
0
3
5
25%
11 Adler Mode GmbH
Retail
1,602
€ 9.25
€ 14,820
€ 100
0
12
0
3
5
25%
12 C&A Mode KG
Retail
359
€ 13.00
€ 4,672
€ 100
0
12
0
3
5
25%
Other Units
1
€ 88.33
€ 88
€0
14 Friseur Klier GmbH
Retail
81
€ 25.00
€ 2,035
€ 100
0
12
0
3
5
25%
Retail
36
€ 25.00
€ 900
€ 100
0
12
0
3
5
25%
16 Dogan
Retail
50
€ 25.00
€ 1,250
€ 100
0
12
0
3
5
25%
17 Dogan
Retail
46
€ 25.00
€ 1,140
€ 100
0
12
0
3
5
25%
0
0
0
0
0%
Retail
144
€ 13.00
€ 1,874
€ 100
0
12
5
25%
Retail
35
€ 13.00
€ 455
€ 100
0
12
0
3
5
25%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
0%
21 Le Thahn Ha
Other Units
1
€ 500.00
€ 500
€0
0
0
0
0
5
0%
Retail
62
€ 25.00
€ 1,550
€ 100
0
12
0
3
5
25%
Other Units
1
€ 1171.00
€ 1,171
€0
0
12
0
0
10
10%
Other Units
1
€ 532.00
€ 532
€0
0
12
0
0
10
10%
External parking
400
€ 0.00
€0
€0
0
0
0
0
5
100%
22 Almaz Mode & Mehr
23 Kiosk
24 Turnover Rent
25 External Parking
Total
* months
9,524 sqm
** years
0
3
5
25%
€ 102,195
Page 7 of 12
.
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
9,524
0
0
0
0
0
9,524
0
5
0
400
405
Area Vacant
m²
0
80
0
0
0
0
0
80
0
0
0
0
0
Area Let
m²
0
9,444
0
0
0
0
0
9,444
0
5
0
400
400
Vacancy Rate
%
0.00%
0.84%
0.00%
0.00%
0.00%
0.00%
0.00%
0.84%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
8.55
0.00
0.00
0.00
0.00
0.00
0.00
458.27
8.79
0.00
0.00
Contractual
Rent
€/month
0
80,765
0
0
0
0
0
0
2,291
83,056
0
0
Contractual
Rent
€/year
0
969,178
0
0
0
0
0
0
27,496
996,674
0
0
Potential
Rent
€/year
0
979,306
0
0
0
0
0
0
27,496
1,006,802
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
10.49
0.00
0.00
0.00
0.00
0.00
0.00
458.27
10.73
0.00
0.00
Market
Rent
€/year
0
1,198,841
0
0
0
0
0
0
27,496
1,226,337
0
0
Market
Rent
€/month
0
99,903
0
0
0
0
0
0
2,291
102,195
0
0
Over-/ UnderRented
0.0%
-18.5%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
-18.0%
0.0%
0.0%
Space productivity
7,000
11.00
6,500
10.00
Explanation
10.41
Market rent
9.00
6,000
Contractual Rent
8.00
Rent / m² / month
5,500
5,000
4,500
7.81
7.75
Rents
7.00
6.00
5.47
5.20
5.00
€ / m²
%
Contractual
2.1%
5.47
Market
3.0%
7.75
4% of turnover
10.41
3% of turnover
7.81
4,000
Turnover potential
3,990
3.00
2.00
1.0%
in € / m² p.a.
17,156,874 €
(net)
Sales Area
3,000
5.20
2% of turnover
4.00
3,500
1.5%
based on sales area
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 4,300 m²
5,495 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
ALPHA Warenhandel GmbH & Co. KG
€ 360,815
36%
8.7 years
80
3AA 1
1
96
€ 9,400 (single) € 42,000 (total)
The main tenant is a corporation belonging to the ALPHA Warenhandel GmbH & Co. KG, which in turn
belongs to the Lidl & Schwarz Group, one of the biggest grocer groups in Europe. According to Dun &
Bradstreet (D&B) rating as at 28.01.2014 ALPHA Warenhandel GmbH & Co. KG has a very low credit
risk. The risk of insolvency (D&B Score) within the next 12 months compared with other German
companies is assessed to be low, i.e. 96% of businesses on the German database have the same or
higher risk of failure. According to section 19 of the main lease agreement entered into by the landlord
and Kaufland Dienstleistung GmbH & Co. KG (D&B Rating = 2AA 1), an assignment of the main lease
agreement by the tenant to another entity of the Kaufland group requires that the landlord's credit risk
rating may not deteriorate due to such assignment of the lease.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
5
Market Value
The property is almost fully let to sixteen retail tenants. The WALT of the property amounts to 6.7 years. The main tenant is Kaufland with a share of approx. 36% of the rental income. The property is currently 12%
under-rented, due to a very low rental level of the main tenant Kaufland. As the lease contract is valid until 2022 and the tenant has options until 2037, we do not believe that the rental level can be adjusted before
2037. The rent of Kaufland is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI basis. Indexation started on 01.04.2009. The majority of the
tenants pay all costs (including ground tax, insurance costs and management costs) except for maintenance costs for structural repairs. Ground tax, maintenance costs for structural repairs, management and
insurance costs will not be borne by Kaufland, C&A and some smaller other units. The rest can be apportioned to the tenants in accordance with the German Regulation on Operating Costs.
The following tenants have extended their lease contracts: Nguyen - Asian Food until 6/14, Sparkasse Westmünsterland until 9/14, Bott until 2/15, Dogan until 7/14 and 10/14 and FOTOFIX Schnellphotoautomaten
GmbH until 11/14.
Discount rate
7.15%
Capitalisation rate
6.50%
account such facts as the stable Cash Flow, the long lease contract with the tenant Kaufland, the good
location, full occupancy and the good condition of the subject property.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.57 /m²
€ 1.73 /m²
€ 0.43 /m²
€ 0.00 /m²
€ 9.24 /m²
€ 52,384
€ 14,950
€ 16,519
€ 4,138
€0
€ 87,991
per year
per year
€ 5.50 /m²
€ 1.93 /m²
€ 1.73 /m²
€ 0.43 /m²
€ 0.00 /m²
€ 9.60 /m²
€ 52,384
€ 18,395
€ 16,519
€ 4,138
€0
€ 91,436
Inflation
% of Gross
Contract Rent
5.26%
1.50%
1.66%
0.42%
0.00%
8.83%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
4.27%
1.50%
1.35%
0.34%
0.00%
7.46%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 52,383
€ 53,221
€ 54,168
€ 55,121
€ 56,014
€ 56,899
€ 57,810
€ 58,746
€ 59,675
€ 60,558
€ 61,442
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 15,414
€ 16,308
€ 16,771
€ 16,890
€ 16,688
€ 16,037
€ 16,799
€ 16,877
€ 16,953
€ 17,694
€ 17,568
Insurance
Costs
€ 4,138
€ 4,205
€ 4,280
€ 4,355
€ 4,425
€ 4,495
€ 4,567
€ 4,641
€ 4,715
€ 4,784
€ 4,854
Ground
Tax
€ 16,519
€ 16,783
€ 17,082
€ 17,383
€ 17,664
€ 17,943
€ 18,230
€ 18,526
€ 18,819
€ 19,097
€ 19,376
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 89,415
€ 91,884
€ 92,374
€ 93,749
€ 95,270
€ 97,707
€ 98,404
€ 101,426
€ 108,420
€ 104,445
€ 105,456
Vacancy
Costs
€ 961
€ 1,367
€ 73
€0
€ 479
€ 2,333
€ 998
€ 2,636
€ 8,258
€ 2,312
€ 2,216
% of Total
Gross Revenue
8.7%
8.5%
8.3%
8.3%
8.6%
9.1%
8.8%
9.0%
9.6%
8.9%
9.0%
12.0%
9.6%
10.0%
8.7%
9.1%
8.5%
8.3%
8.3%
8.6%
8.8%
9.0%
8.9%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,083,316
€ 1,114,111
€ 1,119,690
€ 1,126,018
€ 1,119,995
€ 1,127,527
€ 1,145,252
€ 1,164,515
€ 1,213,057
€ 1,216,058
€ 1,225,220
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 55,697
-€ 26,927
-€ 1,590
€0
-€ 7,483
-€ 58,364
-€ 25,348
-€ 39,396
-€ 82,837
-€ 36,438
-€ 53,992
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,027,619
€ 1,087,184
€ 1,118,100
€ 1,126,018
€ 1,112,512
€ 1,069,163
€ 1,119,904
€ 1,125,119
€ 1,130,220
€ 1,179,620
€ 1,171,228
Nonrecoverable
Costs
-€ 89,415
-€ 91,884
-€ 92,374
-€ 93,749
-€ 95,270
-€ 97,707
-€ 98,404
-€ 101,426
-€ 108,420
-€ 104,445
-€ 105,456
Net
Operating
Income
€ 938,204
€ 995,300
€ 1,025,726
€ 1,032,269
€ 1,017,242
€ 971,456
€ 1,021,500
€ 1,023,693
€ 1,021,800
€ 1,075,175
€ 1,065,772
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 9,497
-€ 22,095
€ 906,612
-€ 14,382
-€ 7,574
€ 973,344
-€ 2,202
-€ 1,193
€ 1,022,331
€ 1,032,269
€0
€0
-€ 4,791
€ 1,010,576
-€ 1,875
-€ 12,490
-€ 20,530
€ 938,436
-€ 7,183
€ 1,004,788
-€ 9,529
€ 1,001,986
-€ 14,747
-€ 6,960
-€ 23,122
-€ 76,928
€ 921,750
-€ 5,179
-€ 2,034
€ 1,067,962
€ 17,120,244
-€ 14,881
-€ 38,006
Present
Value @
7.15%
€ 878,259
€ 880,550
€ 862,752
€ 813,038
€ 742,695
€ 643,387
€ 643,126
€ 598,442
€ 513,792
€ 556,211
€ 8,581,994
€ 15,714,246
€0
€ 15,714,246
8.0%
€ 1400000.0
6.8%
€ 1200000.0
6.0%
6.3%
6.5%
6.6%
6.5%
6.5%
6.5%
7.0%
6.5%
6.2%
6.0%
5.0%
€ 800000.0
4.0%
€ 600000.0
Running yield
Rental income
€ 1000000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 996,674
€ 8.72
Market rental value
total p.a.
per m²/month
€ 1,226,337
€ 10.73
-13.26%
Over-/Underrent
Year 8
Total
€ 15,700,000
per m²
€ 1,648
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
5.79%
7.23%
Gross Initial Yield
6.73%
8.29%
Total
€ 14,800,000
per m²
€ 1,554
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 28.01.2014, the main tenant, ALPHA Warenhandel GmbH & Co. KG, has good covenant strength,
which ensures a secure cash flow for the remainder of the lease term until at least 2022. Furthermore, according to section 19 of the main lease agreement entered into by the landlord and Kaufland Dienstleistung
GmbH & Co. KG (D&B Rating = 2AA 1), an assignment of the main lease agreement by the tenant to another entity of the Kaufland group requires that the landlord's credit risk rating will not deteriorate due to such
an assignment of the lease. Section 1 of the first amendment to the main lease agreement provides for the assignment of the main lease agreement to ALPHA Warenhandel GmbH & Co. KG, which has a worse
D&B Rating (DD 2). Pursuant to section 2 of the first amendment to the main lease agreement, the former tenant remains jointly and severally liable for the landlord's payment claims. Hence, the former tenant is a
guarantor for the lease payments of the current tenant. In terms of a resale, we considered such facts as visibility, condition and building age, competition situation and location.
unchanged and have been applied according to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent. Regarding comparable rents, we
have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the section "Investment Comparables".
The turnover and space productivity analysis shows that the main tenant Kaufland has a very low rental level. We have assumed that it is relatively unlikely to adjust the contract rent to the higher market rent after
2022 (as 3x5-year extension options are in place), which on the other hand further improves the cash-flow security and stability. We have not been provided with updated information regarding necessary capital
expenditures.
The following changes have taken place compared with 31. March 2013: The gross rental income decreased approx. € 90,000 due to the new vacancy of the former Büsch area and due to the decreased income of
Almaz Mode & Mehr. The remaining lease term remained unchanged (6.7 yrs) due to six prolongations of lease contracts.
Page 10 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Photos
View towards main Kaufland entrance
View from Heidener Strasse towards rear side of the complex
Delivery zone to the north side of the building
Escalator from the park deck on top of the building to the ground floor level
External porch - facade to the south
Internal shopping mall
Page 11 of 12
abc
Property address
Property no.
5
Portfolio:
Matrix Portfolio
Heidenerstraße 32
Valuation date:
31.12.2013
46325 Borken
Inspection date:
28.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Kaufland
Kaufland
Kaufland
Kaufland
real,Marktkauf
Wehmeyer
Strauss Innovation
City
Freital
Geldern
Lübbenau
Bochum
Rhede
Lübbenau
Herne
Recklinghausen
Property Type
Fashion Store
Fashion Store
Area
8,000 m²
8,749 m²
7,887 m²
6,388 m²
8,170 m²
5,479 m²
1,622 m²
1,085 m²
Total Rent p.m.
€ 62,000
€ 67,805
€ 71,298
€ 56,214
€ 57,925
€ 42,353
€ 13,382
€ 10,329
Rent p. sqm
€ 7.75 /m²
€ 7.75 /m²
€ 9.04 /m²
€ 8.80 /m²
€ 7.09 /m²
€ 7.73 /m²
€ 8.25 /m²
€ 9.52 /m²
Comment
Comparable location < 50 km distance
Comparable purchasing power - distance 9.0 km
Comparable purchasing power - distance 24.0 km
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
6
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Vertrieb SIGMA GmbH & Co. KG
Total lettable area
Total parking units
13,398 m²
498 units
7.2%
5.8 years
1975
2004
total p.a.
per m² / month
€ 1,164,606
€ 7.24
total p.a.
per m² / month
€ 372,900
€ 2.32
total p.a.
per m² / month
€ 791,707
€ 4.92
total p.a.
€ 1,625,168
-23.2%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Very good accessibility from Fuchsengarten to the parking area
Good branch and tenant mix
Established location, pedestrian zone of Erlangen in immediate vicinity
0
Multi-storey self-service department store
Leasehold on car park
Confusing route marking through the parking area to the sales area
Low visibility from "Altstadtmarkt-Passage" and Hauptstraße
Vacancy rate of approx. 7%
Opportunities
Threats
Property is currently let below market rental level (under-rented)
Prolongation of the main lease contract, Kaufland exercises its options until 2037
Re-letting of the vacant units
0
0
Strong dependancy from the main tenant Kaufland
Other tenants along pedestrain passage could also terminate their contracts
Long-term vacancies possible
Potential increase of maintenance costs due to building age (1975)
0
Building
Location
Building age
Lettable Area
Property condition
General impression
4
4
3
2
6 to 10 years
Between 12,500 and 15,000 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
4
4
4
3
Good location and catchment area
Good micro location
Investment Quality
WALT
Over- / underrent
Quality of tenants
5 Significantly underrented (more than -15%)
Investment market
Investment volume
Saleability
4 Well developed property market
4 Good lot size
The property has 4 buildings: a car park, a self-service department store, some units along an uncovered pedestrian passage and a commercial building. The 4-storey car park, accessible via Fuchsengraben, was
completed in 1993. The upper parking area is roofless, and accessible via a staircase and 2 elevators. It is built as an open steel construction with reinforced concrete floor slabs. The outer boundaries have steel
railings. The three-storey self-service department store was completed in 1975 and refurbished in 2004. The drinks cash-and-carry is on the ground floor. The store access is adjacent to the parking area or
internally via escalators. Kaufland’s sales area, the cash area as well as several smaller shops are on the first floor. The main entrance to Kaufland is from the pedestrian passage “Altstadtmarktpassage”. The
second floor is connected by escalators. The delivery zone is located south of the subject site. The delivery area for the drinks cash-and-carry and other goods are separate.
However, access to both zones is via Fuchsengraben. The self-service department store is a frame construction. The façade mostly has plastered prefabricated concrete panels, with some sandwich panels. The
single-storey related units are built on the first floor level of the tenant “Kaufland”. The units were built at the same time as the self-service department store. Both buildings have a flat roof. The pedestrian passage
entrance is from “Kaufland” as well as from Hauptstraße. The 3-storey commercial building is located on Hauptstraße and was completed in 1975. The pedestrian passage is on the ground floor level. The façade of
the commercial building is listed. The building is made of brickwork and has a gable roof.
Valuation Results
Market Value
€ 12,700,000
equals to
Market Rental Value
€ 948 per m²
€ 1,625,168 p.a.
Discount Rate
7.00%
Net Initial Yield
5.95%
Capitalisation Rate
6.50%
9.36%
excluding
capital
expenditures
Page 1 of 12
€ 10.11 / m² / p.m.
equals to
5.95%
9.36%
10.90
7.81
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Location
Germany
Bavaria
Erlangen (Urban District)
Erlangen
91054
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Erlangen
12,595,891
106,326
106,326
53,081
1,382
1382
0.5%
0.5%
2.9%
3.7%
2.3%
District
City
Federal State
District
District
in m €
in m €
index
index
index
2,744
2,744
109.20
125.15
123.52
Macro Location
Erlangen is located in the Middle Franconia region in the federal state of Bavaria, approx. 25 km north of
Nuremberg. With the cities of Nuremberg and Fuerth, approx. 18 km south of Erlangen, it forms the
metropolitan region Nuremberg. The city has approx. 105,000 inhabitants. The economic structure is
predominantly affected by Siemens AG. The city of Erlangen is the second largest Siemens AG location
worldwide. Different divisions of Siemens AG are operated from Erlangen. Furthermore, some faculties
of the Friedrich-Alexander-Universität Erlangen-Nürnberg are located in Erlangen. The university is the
second largest in the state of Bavaria.
Erlangen is well connected to the German railway network. The city is directly connected to the A73
federal motorway and to the A3 federal motorway. The A9 federal motorway is located about 20 km
away and can be reached in less than 20 minutes. It runs from Berlin to Munich. The city’s traffic network
is further supplemented by the B4 federal road. Erlangen Central Station is a stopping point for ICE
trains. The nearest airport is Nuremberg Airport approx. 15 km from Erlangen. It can be reached in less
than 12 minutes.
Micro Location
Micro Location
The self-service department store is located along Westliche Stadtmauerstraße, whereas the building
parts at the Altstadtmarktpassage extend to the east along Hauptstraße. The high street of Erlangen is
located south of the property just 200 m away. The subject property is accessible via Fuchsengraben by
car and from Hauptstraße by foot. A bus stop is located directly in front of the three-storey commercial
building along Hauptstraße. Due to the city centre location of the property, the surrounding is
characterised by a relatively high density of retail and residential use. The central station is located
approximately 250 m south of the property. The B4 federal road can be accessed in about 3.2 km. The
A74 federal motorway is located around 850 m away.
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
460
3.5
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
17,609 m²
0 m²
Ground lease
Ground lease expiry
n.a.
Yes
30.06.2017, but 30 years options
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
No
Comment
The site is built on different levels. The parking area and the drinks cash-and-carry are constructed at
the same level as Fuchsengraben, whereas the main entrance of the self-service-department store and
the pedestrian passage is constructed at the same level of Hauptstraße. The part of the site with the car
park is bordered by the railway line to the west. To the east, Fuchsengraben runs in an S-curve along
Westliche Stadtmauerstraße, where it is tangent to the street along the railway line. The S-curve is the
western border of the part of the site with the pedestrian passage. This part of the site is bordered by
Hauptstraße to the east.
For the purposes of this valuation, we have assumed that the subject property is free of any soil or
building contamination.
Town Planning
Use class
MK (core zone)
n.a.
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to information from the local authority in Erlangen, a legally binding development plan exists,
entitled no. 253 “Fuchsenwiese” and dated 31.03.1994. The non-food sales area is maximized to
5,000m². The maximum number of full storeys is limited to two, with some areas permitted only to have
one storey.
Tenure
Owner
Land Register
Local Court of Erlangen, TPL Erlangen S.à.r.l.,
land register of Erlangen Luxembourg
Sheet
13012
16991
27710 (leasehold)
28698
Plot
0
Parcel
Sheet 13012
972, 972/1,
1587/1, 1587/2
Sheet 16991
14 (75/100 coownership)
Sheet 27710
1583/7
[Sheet 13012 / 16691 / 27710] 1.) Limited
personal easement (right to operate a self-service
department store) in favour of Kaufland
Dienstleistungs GmbH & Co. KG. 2.) Two building
restrictions (parcel 1587) concerning the
respective owner and Stadt Erlangen. 3.) A
funnel acceptance right (parcel 1587) in favour of
the respective owner. 4.) A cabel ritght in favour
of Erlanger Stadtwerke AG
[Sheet 27710] 1.) Leasehold of DM 350,000 per
year in favour of the landlord of parcel 1583/7,
registered until 30.06.2037, currently in Sheet
28698. 2.) A rigth of way as well as a supply and
removal right in favour of the respective owner.
3.) A pre-emption right in favour of the respective
owner. 4.) A cabel rigth in favour of Erlanger
Stadtwerke AG, Stadt Erlangen and Energievers.
Section 3 (Loans)
Sheet 13012 / 16991
entered on 13 May 2011
Page 3 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
E-center
Rewe
Kaufland
E-center Bächmann
Rewe
Rewe
Edeka Neugebauer
Edeka Neumeister
Rewe
Rewe
Kaufland
Rewe
Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Address
91052 Erlangen, Michael-Vogel-Str. 1a
91052 Erlangen, Karl-Zucker-Str. 10
91052 Erlangen, Carl-Thiersch-Str. 4
91056 Erlangen, Neumühle 4
91056 Erlangen, Rudeltplatz 2
91058 Erlangen, Cumianastr. 4
91088 Bubenreuth, Frankenstr. 75
91058 Erlangen, Weidenweg 1-3
91096 Möhrendorf, Kleinseebacher Str. 8
91083 Baiersdorf, Forchheimer Str. 49
91074 Herzogenaurach, Ohmstr. 12
91077 Neunkirchen, Zum Neuntagwerk 9
Sales area
2,427 m²
1,773 m²
5,353 m²
2,600 m²
1,900 m²
2,374 m²
1,600 m²
1,650 m²
1,700 m²
1,650 m²
1,716 m²
2,300 m²
Distance
1.10 km
1.80 km
1.80 km
2.20 km
2.60 km
2.60 km
3.30 km
4.20 km
4.60 km
7.60 km
8.60 km
8.90 km
Potential
High
Low
Medium
Low
Low
Low
Low
Low
Low
Low
Low
Low
105,175
95,663
52,290
43,939
125.15
Page 4 of 12
2,744
25,742
2.3%
0.5%
123.52
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
6
Main competitors
A self-service department store, Kaufland, is located in a distance of approximately 1.9 km southeast of the subject property. It comprises 5,350m² of sales area. Parking facilities are available
directly in front of the competitor as well as in an adjacent car park. The surrounding area is
characterised by modern office use, medical services and residential use. The competitor is built on
former military areas.
A supermarket “E-Center” is located in close proximity to the railway tracks. It comprises 2,500 m² of
sales area. The supermarket is located approx. 1.3 km south of the subject property. Parking facilities
are available in front of the competitor as well as in the underground car park. Some smaller rather
regional retailers are located near the Edeka.
Competition Comment
The catchment area can be differentiated into primary (Radius 5 km) and secondary (Radius 10 km) catchment areas. More than 100,000 inhabitants live in the primary catchment area. The competitor Kaufland is
located in the primary catchment area approx. 1.9 km away or less than 10 min driving distance. Thus, the vicinity to the city centre is attractive for the customers. The competing property is a one-storey structure.
As both properties offer a full product range, the branch related assortment is generally problematic. In the current valuation, we assumed that the significantly larger sales area of the subject property is combined
with a larger depth of product range. Furthermore, the subject location is in close proximity to Erlangen’s pedestrian zone.
As one-storey self-service department stores generally enjoy a higher degree of acceptance than multi-storey departments, we assumed that there is no immediate competition for the purchasing power of the
customer. There is no direct competition between a city centre self-service department store and a location close to the city centre. Hence, we are of the opinion that both department stores can co-exist in the long
term. The second competitor E-Center is located in the primary catchment area. However, with a sales area of approx. 2,500 m², the store offers a lower depth and breadth of product range. The assortment is not
branch related. The second competitor is therefore also not a direct competitor of the subject property. An important advantage of the subject property over other competitors is that the close proximity of Erlangen’s
pedestrian zone holds additional benefits. Thus, the parking area of the subject property is also used for shopping in the high street of Erlangen. Afterwards, the weekly shopping for every day commodities can be
done.
The multi-storey sales area of the subject property is no disadvantage. Generally, development within the city centre has a higher density and is characterised by higher land use type. However, further smaller
shopping facilities for everyday commodities are located within the city centre. Considering all mentioned factors, the competition level can be described as medium.
Turnover analysis
The rents in functional a retail agglomeration are linked to turnover. The percentage rate that a retail tenant can use for rental payments (turnover-to-rent ratio) depends on the margins achievable in the various
market sectors. This rate normally ranges between 2% and 15% depending on the respective branch. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m². For Kaufland, we have
also been provided with turnover figures. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range
of 2% to 4%, which is acceptable for a self-service department store. Considering the location factors and the competition level within Erlangen, we assumed that a higher turnover-to-rent ratio regarding a similar
branch and turnover is realistic. Hence, a higher market rent is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.
0
Conclusion
The subject property is a self-service department store situated in a very good location within Erlangen. The depth and breadth of the product range is very good. However, the property is not easily accessible by
foot due to the confusing route marked from the parking area to the tenant Kaufland. The property is also less visible from the street Fuchsengraben and Hauptstraße. Furthermore, we are of the opinion that the
tenant and branch mix within the one-storey units along the pedestrian passage are critical. Currently, there are five vacant units. We assumed that access from the parking area is used more frequently by
customers as opposed to the access road from Hauptstraße. As the pedestrian passage can be defined as a secondary location, the frequency of passersby is rather low. Furthermore, the tenant and branch mix is
not comparable with that of the pedestrian zone. The profit of the tenants within the passage is very dependent on Kaufland.
The rental area of Kaufland can be regarded as relatively unproblematic. In the unlikely case that Kaufland vacates the premises, the property could be re-let to other self-service department stores as real,
Marktkauf or E-Center. However, the third-party usability of the area is limited. The lettable area is not suitable for large-scale retail purposes such as a DIY store or furniture store. Both branches are not as strong
as a self-service department store. The numbers of passersby also cannot be increased in the long term. According to the turnover analysis, the turnover rent is at the lower end of the range and a higher turnoverto-rent-ratio is achievable. Therefore, the retail unit is currently heavily under-rented. We assumed that the tenant Kaufland will exercise its three options, each for five years, by 2037. During this time, there will be
steady demand for ancillary lettable spaces within the property. The main competitors of the subject property is E-Center, which is located approx. 1.1 km away.
Page 5 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Kraus
Area Category
Retail
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
GT I PM
Let
73
€ 950
13.01
Yes
30.06.2007
30.05.2017
75%
2 Kaufland Vertrieb SIGMA GmbH & Co. KG
Retail
Let
10,737
€ 56,598
5.27
No
01.10.2007
30.09.2022
100%
3 Vacant (Tran Thi)
Retail
Vacant
160
€0
0.00
Yes
01.10.2010
30.09.2014
75%
GT I PM
4 Vacant (Frisör Klier GmbH)
Retail
Vacant
116
€0
0.00
5 Amorim-Kneisl
Retail
Let
88
€ 926
10.52
6 Vacant
Retail
Vacant
85
€0
0.00
7 Deutscher Hausfrauen-Bund e.V.
Office
Let
280
€ 1,718
6.13
Yes
06.12.2006
05.12.2016
75%
GT I PM
8 Hauswirtschaftliches Serviceteam GmbH
Retail
Let
80
€ 494
6.18
Yes
01.01.2008
30.11.2017
75%
GT I PM
9 Stadt- und Kreissparkasse Erlangen
Retail
Let
34
€ 490
14.30
No
06.02.2007
31.07.2014
75%
10 Stadt Erlangen
Retail
Let
161
€ 845
5.25
Yes
15.09.2011
30.09.2014
75%
GT I PM
11 Schmidl
Retail
Let
37
€ 521
13.92
Yes
01.04.2007
31.03.2014
75%
GT I PM
12 Topuz
Retail
Let
41
€ 1,042
25.68
Yes
01.09.2004
31.08.2014
75%
GT I PM
GT I PM
GT I
13 Endres
Retail
Let
47
€ 2,277
48.45
Yes
02.07.2007
01.07.2017
75%
14 Orientteppich-Galerie
Retail
Let
137
€ 1,047
7.65
Yes
01.12.2010
30.11.2014
75%
GT I PM
15 Apotheke Bernd Nürmberger
Retail
Let
87
€ 2,741
31.50
Yes
01.01.2001
31.12.2015
75%
GT I PM
Retail
Let
112
€ 1,368
12.22
Yes
01.10.2010
30.09.2014
75%
GT I PM
17 Linus Schade + Julian Wening
16 Rüffer
Residential
Let
102
€ 746
7.33
Yes
01.08.2007
31.12.2014
75%
GT I PM
18 Müller
Residential
Let
139
€ 734
5.28
Yes
01.10.2009
31.12.2014
75%
GT I PM
No
03.08.2009
02.08.2014
100%
75%
19 Vacant (Tran Thi)
Storage
Vacant
60
€0
0.00
Other Units
Let
12
€ 530
44.17
Internal Parking
Let
1
€ 79
79.41
Yes
01.07.2008
31.12.2014
22 Schmidl
Internal Parking
Let
1
€ 29
29.41
Yes
01.07.2008
31.12.2014
75%
23 Bätz
Internal Parking
Let
1
€ 29
29.41
Yes
01.10.2010
31.12.2014
75%
24 Metzgerei Ludwig Walk GmbH
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2008
31.12.2014
75%
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2008
31.12.2014
75%
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2008
31.12.2014
75%
27 Vacant
Internal Parking
Vacant
1
€0
0.00
28 Vacant
Internal Parking
Vacant
1
€0
0.00
29 Oberbank Erlangen
Internal Parking
Let
1
€ 29
29.41
Yes
01.06.2009
31.12.2014
Internal Parking
Let
1
€ 29
29.41
Yes
01.06.2009
31.12.2014
75%
Internal Parking
Let
1
€ 29
29.41
Yes
01.06.2009
31.12.2014
75%
32 Fuchs
Internal Parking
Let
1
€ 29
29.41
Yes
18.06.2009
31.12.2014
75%
33 Gottschling
Internal Parking
Let
1
€ 29
29.41
Yes
11.11.2010
31.12.2014
75%
34 Meyer
Internal Parking
Let
1
€ 29
29.41
Yes
01.04.2010
31.12.2014
75%
35 Denslinger Richardson
Internal Parking
Let
1
€ 29
29.41
Yes
15.08.2009
31.12.2014
75%
36 Haas-Eberhard
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2010
31.12.2014
75%
37 Haas-Eberhard
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2010
31.12.2014
75%
38 Haas-Eberhard
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2010
31.12.2014
75%
39 Rüffer
Internal Parking
Let
1
€ 29
29.41
Yes
01.10.2010
31.12.2014
75%
Other Units
Let
1
€0
0.00
Yes
01.01.2007
31.12.2014
75%
GT I
Internal Parking
Let
470
€ 20,000
42.55
Yes
01.11.2008
unlimited
75%
GT I
42 Vacant
Retail
Vacant
366
€0
0.00
43 Stadt Erlangen
Office
Let
144
€ 490
3.41
Yes
01.06.2011
31.05.2016
75%
GT I
44 Stadt Erlangen
Office
Let
92
€ 463
5.03
Yes
01.06.2011
31.05.2016
75%
GT I
Internal Parking
Let
1
€ 29
29.41
Yes
01.02.2011
31.12.2014
75%
0%
Internal Parking
Let
1
€ 29
29.41
Yes
01.02.2011
31.12.2014
75%
0%
47 Mönius
Internal Parking
Let
1
€ 29
29.41
Yes
15.02.2011
31.12.2014
75%
0%
48 Knauer
Internal Parking
Let
1
€ 29
29.41
Yes
15.04.2011
30.06.2014
75%
0%
49 Thiem-Hofmann
Internal Parking
Let
1
€0
0.00
Yes
10.03.2011
31.12.2014
75%
0%
50 Stadt Erlangen
Internal Parking
Let
1
€ 35
35.00
Yes
01.06.2011
31.05.2016
75%
0%
51 Stadt Erlangen
Internal Parking
Let
1
€ 35
35.00
Yes
01.06.2011
31.05.2016
75%
0%
52 Stadt Erlangen
Internal Parking
Let
1
€ 35
35.00
Yes
01.06.2011
31.05.2016
75%
0%
53 Stadt Erlangen
Internal Parking
Let
1
€ 35
35.00
Yes
01.06.2011
31.05.2016
75%
0%
54 Vacant (Kolasinac GbR, Thiem-Hofmann)
Retail
Vacant
90
€0
0.00
55 Vacant
Retail
Vacant
81
€0
0.00
Yes
01.10.2012
30.09.2017
75%
GT I PM
00.01.1900
30.09.2022
90%
0%
00.01.1900
30.09.2022
90%
0%
40 Gemeinnützige Wohnungsbaugesellschaft
41 Parking Garage
56 Deminer Imbiss
Retail
Let
50
€ 530
10.60
57 Mall Income
Other Units
Let
1
€0
0.00
58 Kiosk
Other Units
Let
1
€ 1,733
1733.00
13,398 m²
€ 97,051
Total
Yes
75%
Page 6 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Area Category
Tenant Name
1 Kraus
Area
sqm/unit
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
€ 100
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
Retail
73
€ 11.50
€ 840
0
15
0
3
5
2 Kaufland Vertrieb SIGMA GmbH & Co. KG
Retail
10,737
€ 8.20
€ 88,040
€ 50
0
12
0
3
10
0%
3 Vacant (Tran Thi)
Retail
160
€ 10.00
€ 1,600
€ 100
15
15
0
3
5
100%
4 Vacant (Frisör Klier GmbH)
Retail
116
€ 11.50
€ 1,334
€ 100
15
15
0
3
5
100%
5 Amorim-Kneisl
Retail
88
€ 11.50
€ 1,012
€ 100
0
15
0
3
5
25%
6 Vacant
Retail
85
€ 10.00
€ 850
€ 100
0
15
0
3
5
100%
7 Deutscher Hausfrauen-Bund e.V.
Office
0
25%
280
€ 6.00
€ 1,680
15
0
3
5
Retail
80
€ 10.00
€ 800
€ 100
0
15
0
3
5
25%
9 Stadt- und Kreissparkasse Erlangen
Retail
34
€ 12.00
€ 411
€ 100
0
15
0
3
5
25%
10 Stadt Erlangen
Retail
161
€ 10.00
€ 1,610
€ 100
0
15
0
3
5
25%
11 Schmidl
Retail
37
€ 12.00
€ 450
€ 100
0
15
0
3
5
25%
12 Topuz
Retail
41
€ 12.00
€ 487
€ 100
0
15
0
3
5
25%
13 Endres
5
25%
€ 100
Retail
47
€ 15.00
€ 705
€ 100
Retail
137
€ 9.00
€ 1,233
€ 100
0
15
0
3
5
25%
15 Apotheke Bernd Nürmberger
Retail
87
€ 11.50
€ 1,001
€ 100
0
15
0
3
5
25%
16 Rüffer
17 Linus Schade + Julian Wening
18 Müller
19 Vacant (Tran Thi)
0
15
0
3
25%
Retail
112
€ 11.50
€ 1,287
€ 100
0
15
0
3
5
25%
Residential
102
€ 6.50
€ 661
€ 380
0
6
0
3
5
25%
Residential
139
€ 904
€ 380
0
6
0
3
5
25%
Storage
60
€ 0.00
€0
€ 100
15
15
0
3
5
100%
Other Units
12
€ 44.17
€ 6.50
€ 530
€0
0
0
0
0
5
0%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
22 Schmidl
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
23 Bätz
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
27 Vacant
Internal Parking
1
€ 30.00
€ 30
€0
6
6
0
0
5
100%
28 Vacant
Internal Parking
1
€ 30.00
€ 30
€0
6
6
0
0
5
100%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
32 Fuchs
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
33 Gottschling
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
34 Meyer
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
35 Denslinger Richardson
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
36 Haas-Eberhard
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
37 Haas-Eberhard
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
38 Haas-Eberhard
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
39 Rüffer
Internal Parking
1
€ 30.00
€ 30
€0
0
6
0
0
5
25%
25%
40 Gemeinnützige Wohnungsbaugesellschaft
41 Parking Garage
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
Internal Parking
470
€ 42.55
€ 20,000
€0
0
0
0
0
5
25%
42 Vacant
Retail
366
€ 9.00
€ 3,294
€ 100
15
15
0
3
5
100%
43 Stadt Erlangen
Office
144
€ 6.00
€ 862
€ 100
0
15
3
3
5
25%
44 Stadt Erlangen
Office
92
€ 6.00
€ 552
€ 100
0
15
3
3
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
25%
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
25%
0
5
25%
47 Mönius
0
0
48 Knauer
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
49 Thiem-Hofmann
Internal Parking
Internal Parking
1
1
€ 30.00
€ 30.00
€ 30
€ 30
€0
€0
0
0
0
0
0
5
25%
50 Stadt Erlangen
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
25%
25%
51 Stadt Erlangen
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
25%
52 Stadt Erlangen
Internal Parking
1
€ 30.00
€ 30
€0
0
0
0
0
5
25%
53 Stadt Erlangen
Internal Parking
€ 30.00
€ 30
€0
0
0
0
0
5
25%
54 Vacant (Kolasinac GbR, Thiem-Hofmann)
Retail
90
€ 11.50
€ 1,035
€ 100
15
15
0
3
5
100%
55 Vacant
Retail
81
€ 11.50
€ 932
€ 100
15
15
0
3
5
100%
25%
56 Deminer Imbiss
1
Retail
50
€ 15.00
€ 750
€ 100
0
15
0
3
5
57 Mall Income
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
10%
58 Kiosk
Other Units
1
€ 1733.00
€ 1,733
€0
0
0
0
0
5
10%
Total
* months
13,398 sqm
** years
€ 135,431
Page 7 of 12
.
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
516
12,582
0
0
0
241
60
13,398
0
15
498
0
513
Area Vacant
m²
0
898
0
0
0
0
60
958
0
0
2
0
2
Area Let
m²
516
11,684
0
0
0
241
0
12,440
0
15
496
0
496
Vacancy Rate
%
0.00%
7.14%
0.00%
0.00%
0.00%
0.00%
100.00%
7.15%
0.00%
0.00%
0.40%
0.00%
0.39%
Income Analysis
Contractual
Rent
€/m²/month
5.18
5.98
0.00
0.00
0.00
6.15
0.00
0.00
150.87
6.13
41.95
0.00
Contractual
Rent
€/month
2,670
69,830
0
0
0
1,480
0
0
2,263
76,243
20,808
0
Contractual
Rent
€/year
32,040
837,961
0
0
0
17,758
0
0
27,156
914,915
249,691
0
Potential
Rent
€/year
32,040
930,177
0
0
0
17,758
0
0
27,156
1,007,131
250,696
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
6.00
8.56
0.00
0.00
0.00
6.50
0.00
0.00
150.87
8.55
41.85
0.00
Market
Rent
€/year
37,128
1,292,025
0
0
0
18,779
0
0
27,156
1,375,088
250,080
0
Market
Rent
€/month
3,094
107,669
0
0
0
1,565
0
0
2,263
114,591
20,840
0
Over-/ UnderRented
-13.7%
-30.2%
0.0%
0.0%
0.0%
-5.4%
0.0%
0.0%
0.0%
-28.3%
0.2%
0.0%
Space productivity
7,000
12.00
6,500
11.00
Explanation
11.36
Market rent
10.00
6,000
Contractual Rent
9.00
8.52
8.20
Rent / m² / month
5,500
5,000
4,500
8.00
7.00
6.00
5.68
5.27
5.00
4,000
Rents
1.9%
5.27
Market
2.9%
8.20
4% of turnover
11.36
3% of turnover
8.52
4.00
Turnover potential
in € / m² p.a.
36,582,177 €
(net)
3.00
2.00
1.0%
5.68
2% of turnover
4,335
3,500
3,000
€ / m²
%
Contractual
1.5%
based on sales area
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Sales Area
~ 8,439 m²
Total Area
10,737 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Vertrieb SIGMA GmbH & Co. KG
€ 679,176
58%
8.7 years
n.a.
O
n.a.
n.a.
n.a.
According to section 19 of the main lease agreement entered into by the landlord and Kaufland
Dienstleistung GmbH & Co. KG (D&B Rating = 2AA 1), an assignment of the main lease agreement by
the tenant to another entity of the Kaufland group requires that the landlord's credit risk rating may not
deteriorate due to such assignment of the lease. Section 1 of the first amendment to the main lease
agreement provides for the assignment of the main lease agreement to Kaufland Vertrieb SIGMA GmbH
& Co. KG. For this tenant, no financial information was available. Accordingly, pursuant to section 2 of
the first amendment to the main lease agreement, the former tenant remains jointly and severally liable
for the landlord's payment claims. Hence, the former tenant is a guarantor for the lease payments of the
current tenant.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
6
Market Value
The property is let to 18 tenants, retail, office and residential tenants. Furthermore, 26 parking spaces are let for permanent use. Currently, six retail units are vacant. The WALT amounts to 7.2 years. The main
tenant is Kaufland with a share of more than 55% of the rental income. The property is currently significantly under-rented due to the very low rental level of the main tenant, Kaufland. As the lease contract is valid
until 2022 and the tenant has options until 2037, we do not believe that the rental level can be adjusted before 2037. Kaufland’s rent is indexed and will be adapted by 50% of the CPI change, whenever the change
exceeds 10 percent in relation to the CPI basis. Indexation started on 01.10.2009. The majority of the tenants pay all costs (including ground tax, insurance costs and management costs) except for maintenance
costs for structural repairs. Ground tax, maintenance costs for structural repairs, management and insurance costs will not be borne by Kaufland. The following tenants have extended their lease contracts: AmorimKneisl until 09/2014, Kreissparkasse until 07/2014, Stadt Erlangen (unit 161 m²) until 9/2014, Schmiedl until 04/2014, Rüffer until 09/2014, Deminer Imbiss until 09/2017, Linus Schade + Julian Wen and Müller until
12/2014.
The following tenants vacated the property: Frisör Klier, Tran Thi, Kolasinac.
Discount rate
7.00%
Capitalisation rate
6.50%
account such facts as the stable Cash Flow, the long lease contract with the tenant Kaufland, the good
location, the low vacancy rate and the good condition of the subject property.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 6.50 /m²
€ 1.30 /m²
€ 4.59 /m²
€ 0.28 /m²
€ 15.17 /m²
€ 27.83 /m²
€ 87,088
€ 17,469
€ 61,457
€ 3,686
€ 203,200
€ 372,900
per year
per year
€ 6.50 /m²
€ 1.82 /m²
€ 4.59 /m²
€ 0.28 /m²
€ 15.17 /m²
€ 28.35 /m²
€ 87,088
€ 24,378
€ 61,457
€ 3,686
€ 203,200
€ 379,808
Inflation
% of Gross
Contract Rent
7.48%
1.50%
5.28%
0.32%
17.45%
32.02%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.36%
1.50%
3.78%
0.23%
12.50%
23.37%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 87,089
€ 88,483
€ 90,058
€ 91,643
€ 93,128
€ 94,599
€ 96,113
€ 97,670
€ 99,213
€ 100,681
€ 102,151
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 17,194
€ 18,845
€ 19,320
€ 19,164
€ 19,321
€ 19,335
€ 18,543
€ 19,813
€ 20,032
€ 20,137
€ 20,297
Insurance
Costs
€ 3,686
€ 3,745
€ 3,811
€ 3,878
€ 3,941
€ 4,004
€ 4,068
€ 4,133
€ 4,199
€ 4,261
€ 4,323
Ground
Tax
€ 61,457
€ 62,440
€ 63,552
€ 64,670
€ 65,718
€ 66,756
€ 67,824
€ 68,923
€ 70,012
€ 71,048
€ 72,086
203,200 €
206,451 €
210,126 €
213,824 €
217,288 €
220,721 €
224,253 €
227,886 €
231,486 €
234,912 €
238,342 €
Total
per year
€ 383,599
€ 383,461
€ 387,982
€ 394,786
€ 399,656
€ 405,584
€ 416,625
€ 419,413
€ 426,484
€ 431,748
€ 437,201
Vacancy
Costs
€ 10,973
€ 3,497
€ 1,115
€ 1,607
€ 260
€ 169
€ 5,824
€ 988
€ 1,542
€ 709
€2
% of Total
Gross Revenue
33.5%
30.5%
30.1%
30.9%
31.0%
31.5%
33.7%
31.8%
31.9%
32.2%
32.3%
40.0%
35.0%
33.7%
33.5%
30.5%
30.1%
30.9%
31.0%
31.5%
31.8%
31.9%
32.2%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,274,627
€ 1,296,092
€ 1,299,429
€ 1,295,865
€ 1,291,434
€ 1,291,692
€ 1,307,457
€ 1,330,509
€ 1,351,162
€ 1,353,075
€ 1,353,425
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 128,393
-€ 39,746
-€ 10,303
-€ 16,905
-€ 3,372
-€ 2,695
-€ 71,260
-€ 9,613
-€ 13,036
-€ 10,618
-€ 284
Rent
Abatements
€0
€0
-€ 1,111
-€ 1,333
€0
€0
€0
€0
-€ 2,659
€0
€0
Total
Gross
Revenue
€ 1,146,234
€ 1,256,346
€ 1,288,015
€ 1,277,627
€ 1,288,062
€ 1,288,997
€ 1,236,197
€ 1,320,896
€ 1,335,467
€ 1,342,457
€ 1,353,141
Nonrecoverable
Costs
-€ 383,599
-€ 383,461
-€ 387,982
-€ 394,786
-€ 399,656
-€ 405,584
-€ 416,625
-€ 419,413
-€ 426,484
-€ 431,748
-€ 437,201
Net
Operating
Income
€ 762,635
€ 872,885
€ 900,033
€ 882,841
€ 888,406
€ 883,413
€ 819,572
€ 901,483
€ 908,983
€ 910,709
€ 915,940
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 1,794
-€ 700
€ 760,141
-€ 103,671
-€ 33,643
€ 735,571
-€ 8,341
-€ 1,987
€ 889,705
€ 869,750
-€ 10,522
-€ 2,569
-€ 3,476
€ 883,684
-€ 1,246
-€ 100
€0
€ 883,313
-€ 14,765
€ 762,985
-€ 41,822
€ 898,090
-€ 2,439
-€ 954
-€ 2,659
-€ 14,686
€ 891,638
-€ 7,225
-€ 2,696
€ 900,788
€ 14,095,416
-€ 54
€0
Present
Value @
7.00%
€ 737,537
€ 663,410
€ 753,541
€ 688,530
€ 653,561
€ 610,718
€ 492,554
€ 542,233
€ 503,169
€ 474,957
€ 7,165,395
€ 13,285,605
€0
€ 13,285,605
8.0%
€ 1600000.0
6.6%
6.8%
6.6%
6.7%
6.8%
6.6%
6.9%
7.0%
6.2%
5.7%
Rental income
6.8%
€ 1200000.0
6.0%
€ 1000000.0
5.0%
€ 800000.0
4.0%
€ 600000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
1.0%
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,164,606
€ 7.24
Market rental value
total p.a.
per m²/month
€ 1,625,168
€ 10.11
-23.17%
Over-/Underrent
Year 8
Running yield
€ 1400000.0
Total
€ 13,300,000
per m²
€ 993
Purchaser's costs
5.00%
Yield Overview
Net Initial Yield
Gross Initial Yield
5.95%
9.36%
9.17%
12.80%
Total
€ 12,700,000
per m²
€ 948
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. The tenant Kaufland has good covenant strength. According to the second amendment of the lease
contract, the former tenant remains jointly and severally liable for the landlord's payment claims. However, the lease contract ensures a secure cash flow for the remainder of the lease term until at least 2022. In
terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building age, third-party usability, competition situation and location. According to the land register, the
leaseholder exercised its leasehold options for in total another 30 years (until 06/37). This is due to the fact that the leasehold is on the car park site, which is in our opinion essential for the operation of the selfservice department store. Otherwise, there are insufficient parking spaces available. The right to prolong the leasehold is registered in Sheet 28698 in the land register of Erlangen.
For the purpose of the valuation on 31.12.2013, we have been provided with an updated rent roll. The contractual rental income decreased, other costs have remained unchanged and have been applied according
to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent. We have not been provided with updated information regarding necessary
capital expenditures, therefore we applied that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of €
6.50/m² per annum. Regarding comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions.
Please refer to the section "Investment Comparables".
0
Page 10 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Photos
View of the car park (leasehold)
View of the Kaufland and the adjacent parking level from the car park
View towards the pedestrian passage ("Altstadtmarktpassage")
View of the commercial building from Hauptstraße
View of a vacant retail unit at the pedestrian passage
View of the entrance to the car park
Page 11 of 12
abc
Property address
Property no.
6
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
91054 Erlangen
Inspection date:
01.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Kaufland
Kaufland
Kaufland
Real
Hairdresser
Pharmacy
Pharmacy
0
City
Straubing
Freital
Geldern
Würzburg
Landshut
Langgöns
Halle
0
Property Type
Hairdresser
Pharmacy
Pharmacy
0
Area
7,315 m²
8,000 m²
8,478 m²
8,450 m²
124 m²
128 m²
80 m²
0 m²
Total Rent p.m.
€ 76,808
€ 62,000
€ 65,705
€ 61,685
€ 1,672
€ 1,453
€ 720
€0
Rent p. sqm
€ 10.50 /m²
€ 7.75 /m²
€ 7.75 /m²
€ 7.30 /m²
€ 13.48 /m²
€ 11.35 /m²
€ 9.00 /m²
€ 0.00 /m²
Comment
Location is farther away from the city centre; lower purchasin
Slightly lower purchasing power
0
Other federal state
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
7
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Warenhandel Südwest GmbH & Co. KG
Total lettable area
Total parking units
9,390 m²
451 units
0.7%
7.0 years
2002
n.a.
total p.a.
per m² / month
€ 640,469
€ 5.68
total p.a.
per m² / month
€ 88,526
€ 0.79
total p.a.
per m² / month
€ 551,943
€ 4.90
total p.a.
€ 835,732
-21.0%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Located near the city center adjacent to the pedestrian area
Strong and well-known anchor tenant
0
High level of competition (another Kaufland nearby)
Two vacant retail areas
0
Opportunities
Threats
Reletting of the main retail area on market level
Kaufland exercises its options until 2037
0
0
Difficult relettability of the fitness studio
Increased vacancy of ancilliary areas due to low turnovers of these tenants
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
3
2
4
4
11 to 15 years
Good general impression
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
4
3
2
Good micro location
High competition level
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The property has four storeys. The ground level is occupied by several retail tenants, the largest being Kaufland. The first floor is a parking level, while the second floor is partly used for parking and accommodates
part of the fitness studio. The third floor is used by the fitness studio as well as a playground. The property has an elongated shape, with the long side facing the B10 federal road ("Gartenstraße").
The property is a steel-reinforced concrete construction with precast elements. The facade is partly made of brick facing and partly of galvanised steel sheets. In the entrance areas, there are curtain walls with metal
frames. The roof is flat with hard covering.
The property can be accessed on the ground floor from Gartenstraße as well as from the parking levels via several elevators.
Valuation Results
Market Value
€ 9,000,000
equals to
Market Rental Value
€ 958 per m²
€ 835,732 p.a.
Discount Rate
7.45%
Net Initial Yield
5.75%
Capitalisation Rate
6.50%
7.75%
excluding
capital
expenditures
Page 1 of 12
€ 7.42 / m² / p.m.
equals to
5.75%
14.05
7.75%
10.77
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Location
Germany
Baden-Wurttemberg
Göppingen (Rural District)
Geislingen
73312
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Geislingen
10,786,227
252,002
26,823
11,532
392
354
-2.2%
0.3%
-1.9%
3.9%
4.0%
District
City
Federal State
District
District
in m €
in m €
index
index
index
5,473
522
107.20
94.45
103.42
Macro Location
Geislingen an der Steige is located in the east of Baden-Wuerttemberg, approx. 25 km from the border
to the federal state Bavaria. The city is a minor secondary centre with approx. 27,000 inhabitants. The
closest major cities are Ulm (approx. 25 km south-east; 122,000 inhabitants) and Stuttgart (approx. 50
km west; 602,000 inhabitants).
The closest motorways are the A8 (Perl - Bad Reichenhall), connecting to Salzburg (Austria) in the
south-east, and the A7 (Flensburg - Füssen), leading to Denmark in the north and Austria in the south.
The motorways can be reached within 18 km and 25 km, respectively.
Geislingen has a train station, which connects Geislingen to the cities of Stuttgart and Ulm via regional
trains. The closest train station offering connections to the high-speed ICE train network is Ulm in a
distance of approx. 25 km.
The nearest airport offering connections to national and international destinations is Stuttgart Airport,
located in a distance of approx. 56 km from the city centre of Geislingen an der Steige.
Geislingen an der Steige is characterized by an industry that has evolved over time. The economy is
mainly based on the processing of steel and metal as well as the automotive supply industry and
traditional beer brewing. Furthermore, Geislingen is also known for its university "Hochschule für
Wirtschaft und Umwelt Nürtingen-Geislingen", offering business and real estate courses. Well-known
companies based in Geislingen include Württembergische Metallwarenfabrik (WMF), ULO
Fahrzeugleuchten (Odelo GmbH), Adlerbrauerei Karl Götz and Schlötter Galvanotechnik.
Micro Location
Micro Location
The self-service department store is located in the southern part of Geislingen an der Steige, near the
city centre. The subject property is situated adjacent to the pedestrian zone of Geislingen along a highly
frequented traffic axis (federal road B10 "Gartenstraße"). The property is bordered by Römerstraße to
the south, Bleichstraße to the west and Bismarckstraße to the north. The surrounding area is
characterized by residential housing with some commercial usage.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
395
5.0
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
10,909 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
Site servicing
€0
Fully serviced
Irregular
Site layout
Soil contamination
No
Comment
According to the Environmental Due Diligence Report, dated July 2007, the site has been industrially
used since 1850 by "Maschinenfabrik Geislingen (MAG)", whose activities included chemical and
mechanical metal working and foundries. From this use stems severe subsoil and ground water
contamination caused by petrol, oil, lubricants and further chemicals. The site has been gradually
remediated from 1989 until 1999 and the soil remediation is considered as finished according to the
Landratsamt Göppingen. However, other sources suggest that there is still contaminated soil beneath
the property and it is likely that the site is listed in the contaminated land cadastre as remediated with
residual contamination. For the purposes of this valuation, we have assumed that the subject property is
free of any soil or building contamination.
Town Planning
Use class
MK (core zone)
1.0
Plot ratio (GFZ)
2.0
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority, a legally binding project and development
plan exists, entitled "20/1/2 Marktgalerie" and dated 01.04.1999, with the following regulations: the
subject site is located in core zone (limitations regarding the use) - "Kerngebiet mit Einschränkung". The
plot ratio (Geschossflächenzahl, GFZ) is 2.0 and the site coverage ratio (Grundflächenzahl, GRZ) is 1.0.
Tenure
Land Register
Local Court of
Geislingen an der
Steige, land register of
Geislingen an der
Steige
Owner
TPL Geislingen S.á.r.l.,
Luxembourg
Sheet
10534
Plot
NO 1051
Parcel
341
Section 3 (Loans)
Two land charges concerning the payment of a
money amount payable to the respective owner of favour of Corealcredit Bank AG, Frankfurt am Main;
entered on 09.06.2011
parcel no 489/11 and several limited personal
easements, among other things regarding the
construction, operation and maintenance of a
transformer station, pipline easement, wayleave
in favor of the city Geislingen an der Steige and
Albwerk GmbH & Co. KG, Geislingen.
Furthermore, there is a limited personal easement
(the right to operate and maintain a hypermarket)
in favor of Kaufland Dienstleistungs GmbH & Co.
KG, Neckarsulm.
Page 3 of 12
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
E-aktiv Markt
Kaufland
Rewe
E-aktiv Markt
0
Type
Hypermarket
Hypermarket
Hypermarket
0
Address
73312 Geislingen, Heidenheimer Str. 139
73312 Geislingen, Neuwiesenstr. 25
73072 Donzdorf, Mozartstr. 35
73079 Süßen, Bühlstr. 23
Sales area
2,900 m²
7,250 m²
1,850 m²
1,900 m²
m²
Distance
2.10 km
2.60 km
8.80 km
9.50 km
Potential
Medium
High
Low
Low
0
0
0
0
0
0
0
0
34,173
42,438
14,920
18,659
94.45
Page 4 of 12
5,473
20,319
4.0%
-2.2%
103.42
abc
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
7
Main competitors
This competitor is a smaller-sized Edeka hypermarket. Furthermore, Dänisches Bettenlager and
Fressnapf are also located on the site. It is built as a retail warehouse agglomeration instead of a
retail park with a mall and offers a different product and service variety than the subject property and
therefore caters to different needs. It represents medium competition.
This competitor is a small retail park located on the south-western outskirts of Geislingen. The main
tenant is a Kaufland. Other tenants include a Kik, Tedi and Quickschuh. This building is well-located in a
small industrial zone. Nearby retailers include Obi, Aldi and Lidl. The property is a serious competitor.
Competition Comment
The catchment area can be differentiated into primary (Radius 5 km) and secondary (Radius 10 km) catchment areas. Approximately 34,173 inhabitants live in the primary catchment area. While the density of
hypermarkets is relatively high in the primary catchment area, the competition eases in the secondary catchment area.
Even though there are several discounters and small-size supermarkets located nearby, it can be said that these present only indirect competition to the property. Kaufland offers a very deep and broad product
range with more than 50,000 products, while supermarkets and discounters generally offer a limited product range with only 7,000 to 11,000 (supermarkets) or 400-2,500 (discounters) articles. Therefore, these
retailing forms address different customers or customer needs. While supermarkets and discounters cater to the daily needs of customers, Kaufland offers more variety for products that are bought on a non-daily
basis. The first competitor is a small retail warehouse agglomeration located on Heidenheimer Straße in a distance of approx. 1.7 km. The main tenant is a Edeka hypermarket.
The location of the property within a commercial agglomeration is inferior to the location of the subject property near the city centre along a highly frequented street. While the competitor is solely reachable by car,
the subject property can also be reached by foot from the adjacent residential area. Furthermore, the tenant mix is different. While both offer the typical service providers, the Edeka-Center also has Fressnapf and
a Dänisches Bettenlager, both tenants that are prone to returning customers, whereas Kaufland is bound to receive more impulse buyers due to its location in the city centre. In addition, the large difference in size
and product range also differentiates both properties. Therefore, it can be said that the Edeka market only represents medium competition. A second Kaufland was opened in January 2010 after the take-over of the
former Schlekkerland (self-service department store) is in an industrial zone on the south-western outskirts of Geislingen. Other tenants in the property include a Kik, Tedi, Klier, Quickschuh, a tobacco shop
and IMO (carwash). Nearby retailers in the commercial zone are OBI, Aldi and Lidl. The tenant mix within the property is very similar to the tenant mix in the subject property and therefore the property presents high
competition potential. Even though the properties may attract different customers and have slightly different primary catchment areas, the catchment areas strongly overlap; two Kaufland self-service department
stores can be problematic. Another potential competitor is the small retail park with 13,000 m², that is currently being build in the city centre on the former sports field. Part of the area is let to REWE and Lidl.
However, it remains to be seen whether it will have an effect on the turnover of Kaufland, because they usually address different customers.
Turnover analysis
The rents in a functional retail agglomeration are linked to turnover. The percentage rate that a retail tenant can use for rental payments (turnover-to-rent ratio) depends on the margins achievable in the various
market sectors. This rate normally ranges between 2% and 15% depending on the respective branch. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m².
Kaufland is represents a very strong anchor, we believe that there will always be demand for such ancillary tenants. For Kaufland, we have also been provided with turnover figures. We have analysed the figures
and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store.
Considering the location factors and the competition level within Geislingen, we assume that a higher turnover-to-rent ratio regarding a similar branch and turnover is realistic. Hence, the market rent after the
termination of the current rental contract has been chosen in a range of 2.2%. Please also refer to the rent/turnover analysis on page 8. Even though turnover rents have been negotiated with some of the tenants,
the necessary turnovers for the turnover rents to become effective have not been reached in the past few years. The tenants only pay the minimum rent. We therefore haven't included any additional turnover
rents.
Conclusion
The subject property is a modern self-service department store with a small mall accommodating additional businesses, such as a hair dresser, locksmith and newspaper kiosk. The property has sufficient parking
spaces and is highly visible and easily accessible by foot and by car. The location of the property close to the city centre entails additional benefits.
As Kaufland is a strong customer magnet, we believe that there will always be sufficient demand for the minor retail areas in the mall. The letting of the current fitness studio, however, is assessed to be more
difficult. Even though the location of the property near the city centre and near a residential area is very good for the current use, the third-party usability of the areas is limited. One alternative use would be the
letting of the space as office space. However, this would involve extensive refurbishment and restructuring measures. Furthermore, the location is not a traditional office location and the demand for such an area is
limited. However, we believe that it is very probable that the fitness studio will remain within the property on an adequate market rental level. The rental area of Kaufland can be regarded as relatively unproblematic.
First of all, the location is very good for such a tenant, as it can be reached both by foot and by car. Furthermore, the property is highly visible and easily accessible.
Even though the competition is quite strong and the density of self-service department store is very high for a town this size, we have not been informed of severe turnover decreases after the second Kaufland on
Neuwiesenstraße was launched. We believe that the tenant will be able to compete with this property, especially because it can operate on a very low contractual rent for a long time. The anchor tenant Kaufland
has a lease contract until 2022 with three options, each for five years, bringing the earliest possible termination date for the landlord to 2037. On the basis of our projection of likely productivity per m² and turnovers,
we have calculated the market rent at € 8.25/m²/month. The tenant currently pays a contractual rent of € 5.47/m²/p.m. Therefore, the retail unit is currently strongly underrented. Due to the margins realizable and
under the assumption of good turnover figures, we believe that Kaufland will remain in the property until 2037. In the unlikely case that Kaufland should vacate the premises, the property could be relet to other selfservice department stores which are currently not present in Geislingen an der Steige such as real or Marktkauf.
Page 5 of 12
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 ROFU Kinderland Spielhandels GmbH
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
1,107
€ 6,000
5.42
Yes
15.08.2012
31.08.2022
75%
GT I PM
2 Bäckerei Staib GmbH & Co. KG
Retail
Let
60
€ 2,585
43.08
Yes
03.04.2002
30.04.2014
75%
GT I PM
3 In Shape-Sports Club GmbH
Retail
Let
2,487
€ 4,100
1.65
Yes
03.09.2008
02.09.2018
75%
GT I PM
4 Metzgerei Chiacci/Reinhard
Retail
Let
57
€ 800
14.02
Yes
15.10.2012
31.08.2014
75%
GT I PM
Yes
01.10.2007
30.09.2022
90%
5 Kaufland Warenhandel Südwest GmbH & Co. KG
Retail
Let
5,065
€ 27,687
5.47
6 Vacant (Mutlu)
Retail
Vacant
12
€0
0.00
7 Vacant
Retail
vacant
50
€0
0.00
8 Deichmann SE
Retail
Let
479
€ 5,899
12.33
Yes
03.04.2002
02.04.2017
75%
GT I PM
Retail
Let
73
€ 1,869
25.52
Yes
03.04.2002
28.02.2017
75%
GT I PM
Other Units
Let
6
€ 265
44.17
Yes
03.08.2009
02.08.2014
75%
GT I PM
External parking
Vacant
1
€0
0.00
Yes
00.01.1900
30.09.2022
100%
GT I PM
30.09.2022
100%
11 Vacant
12 Vacant
External parking
Vacant
1
13 Vacant
External parking
Vacant
1
€0
0.00
Other Units
Let
1
€ 168
168.00
Internal Parking
Let
448
€ 4,000
8.93
9,390 m²
€ 53,372
14 Kiosk
15 Parking
Total
€0
0.00
Page 6 of 12
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Area Category
Area
sqm/unit
1 ROFU Kinderland Spielhandels GmbH
Retail
1,107
€ 7.25
€ 8,026
€ 50
0
12
2 Bäckerei Staib GmbH & Co. KG
Retail
60
€ 65.00
€ 3,900
€ 100
0
6
3 In Shape-Sports Club GmbH
Retail
2,487
€ 1.75
€ 4,353
€ 100
0
15
4 Metzgerei Chiacci/Reinhard
Retail
57
€ 25.00
€ 1,427
€ 100
0
5 Kaufland Warenhandel Südwest GmbH & Co. KG
Retail
5,065
€ 8.25
€ 41,786
€ 50
6 Vacant (Mutlu)
Retail
12
€ 40.00
€ 487
€ 100
Tenant Name
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Agency
Fees*
Lease
Term**
Renewal
Probability
0
3
10
25%
0
3
10
25%
0
3
10
25%
9
0
3
10
25%
0
12
0
3
10
10%
9
9
0
3
10
100%
0
3
10
100%
Rent
Abatem.*
7 Vacant
Retail
50
€ 30.00
€ 1,500
€ 100
6
6
8 Deichmann SE
Retail
479
€ 12.50
€ 5,981
€ 100
0
12
0
3
10
25%
Retail
73
€ 25.00
€ 1,831
€ 100
0
9
0
3
10
25%
Other Units
6
€ 44.17
€ 265
€0
0
0
0
0
10
75%
11 Vacant
External parking
1
€ 30.00
€ 30
€0
12
12
0
0
3
100%
12 Vacant
External parking
1
€ 30.00
€ 30
€0
12
12
0
0
3
100%
13 Vacant
External parking
1
€ 30.00
€ 30
€0
12
12
0
0
3
100%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
10
0%
Internal Parking
448
€ 0.00
€0
€0
0
0
0
0
10
0%
14 Kiosk
15 Parking
Total
* months
9,390 sqm
** years
€ 69,644
Page 7 of 12
.
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
9,390
0
0
0
0
0
9,390
0
7
448
3
458
Area Vacant
m²
0
62
0
0
0
0
0
62
0
0
0
3
3
Area Let
m²
0
9,328
0
0
0
0
0
9,328
0
7
448
0
448
Vacancy Rate
%
0.00%
0.66%
0.00%
0.00%
0.00%
0.00%
0.00%
0.66%
0.00%
0.00%
0.00%
100.00%
0.66%
Income Analysis
Contractual
Rent
€/m²/month
0.00
5.25
0.00
0.00
0.00
0.00
0.00
0.00
61.86
5.29
8.93
0.00
Contractual
Rent
€/month
0
48,939
0
0
0
0
0
0
433
49,372
4,000
0
Contractual
Rent
€/year
0
587,273
0
0
0
0
0
0
5,196
592,469
48,000
0
Potential
Rent
€/year
0
592,777
0
0
0
0
0
0
5,196
597,973
48,000
1,080
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
7.38
0.00
0.00
0.00
0.00
0.00
0.00
37.86
7.41
0.00
30.00
Market
Rent
€/year
0
831,472
0
0
0
0
0
0
3,180
834,652
0
1,080
Market
Rent
€/month
0
69,289
0
0
0
0
0
0
265
69,554
0
90
Over-/ UnderRented
0.0%
-28.9%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
63.4%
-28.5%
0.0%
-100.0%
Space productivity
7,000
Explanation
15.00
14.00
6,000
13.90
6,500
13.00
Market rent
12.00
Contractual Rent
11.00
Rent / m² / month
5,500
5,000
5,028
4,500
10.42
10.00
Rents
9.00
8.25
8.00
7.00
6.95
6.00
4,000
1.6%
5.47
Market
2.4%
8.25
4% of turnover
13.90
3% of turnover
10.42
5.47
5.00
6.95
2% of turnover
4.00
3,500
€ / m²
%
Contractual
Turnover potential
21,116,431 €
(net)
3.00
3,000
2.00
1.0%
in € / m² p.a.
Sales Area
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 4,200 m²
5,065 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Warenhandel Südwest GmbH & Co. KG
€ 332,244
52%
8.7 years
80
2AA 1
1
95
n.a.
area is food retailing with branded goods and own-brands specially produced for Kaufland. According to
Dun & Bradstreet (D&B) Rating as at 09.01.20114 Kaufland Warenhandel Südwest GmbH & Co. KG
has an below-average credit risk. The risk of insolvency (D&B Score) within the next 12 months
compared with other German companies is assessed to be low, i.e. 84% of businesses on the German
database have the same or higher risk of failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
7
Market Value
The property is let to seven retail tenants and a fitness studio. The WALT of the property amounts to 7 years. The main tenant is Kaufland with a share of approx. 52% of the rental income. The property is currently
heavily underrented due to the very low rental level of the main tenant, Kaufland. As the lease contract is valid until 2022 and the tenant has options until 2037, we do not believe that the rental level can be adjusted
before 2037. Kaufland’s rent is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI basis. Indexation started on 01.04.2009. The majority of the
tenants pay all costs (including ground tax, insurance costs and management costs) except for maintenance costs for structural repairs. Ground tax, maintenance costs for structural repairs, management and
insurance costs will not be borne by Kaufland. The rest can be apportioned to the tenant in accordance with the German Regulation on Operating Costs.
The tenant Bäckerei Staib has extended the lease contract until 09/2014. The tenant Mutul vacated the property.
Discount rate
7.45%
Capitalisation rate
6.50%
account such facts as the stable Cash Flow, the long lease contract with the tenant Kaufland, the new
contract with ROFU, the increase in vacancy, the reported turnover figures, the good location and the
good condition of the subject property.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 4.50 /m²
€ 1.02 /m²
€ 3.49 /m²
€ 0.41 /m²
€ 0.00 /m²
€ 9.43 /m²
€ 42,256
€ 9,607
€ 32,799
€ 3,864
€0
€ 88,526
per year
per year
€ 4.50 /m²
€ 1.34 /m²
€ 3.49 /m²
€ 0.41 /m²
€ 0.00 /m²
€ 9.74 /m²
€ 42,256
€ 12,536
€ 32,799
€ 3,864
€0
€ 91,455
Inflation
% of Gross
Contract Rent
6.60%
1.50%
5.12%
0.60%
0.00%
13.82%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.06%
1.50%
3.92%
0.46%
0.00%
10.94%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 42,256
€ 42,932
€ 43,696
€ 44,465
€ 45,185
€ 45,899
€ 46,634
€ 47,389
€ 48,138
€ 48,850
€ 49,564
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 9,935
€ 10,606
€ 10,709
€ 10,348
€ 10,435
€ 10,708
€ 10,882
€ 11,096
€ 10,563
€ 12,136
€ 12,029
Insurance
Costs
€ 3,864
€ 3,926
€ 3,996
€ 4,066
€ 4,132
€ 4,197
€ 4,264
€ 4,333
€ 4,402
€ 4,467
€ 4,532
Ground
Tax
€ 32,799
€ 33,324
€ 33,917
€ 34,514
€ 35,073
€ 35,627
€ 36,197
€ 36,784
€ 37,365
€ 37,918
€ 38,471
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 89,391
€ 90,788
€ 92,318
€ 94,780
€ 103,691
€ 96,521
€ 97,977
€ 99,602
€ 108,429
€ 103,371
€ 104,848
Vacancy
Costs
€ 537
€0
€0
€ 1,387
€ 8,866
€ 90
€0
€0
€ 7,961
€0
€ 252
% of Total
Gross Revenue
13.5%
12.8%
12.9%
13.7%
14.9%
13.5%
13.5%
13.5%
15.4%
12.8%
13.1%
18.0%
16.0%
14.0%
15.4%
14.9%
13.5%
13.7%
12.8%
13.5%
12.9%
13.5%
13.5%
12.8%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Cash Flow
7
Market Value
Rental
Revenue
€ 687,573
€ 707,037
€ 713,960
€ 712,730
€ 714,809
€ 720,696
€ 725,454
€ 740,028
€ 780,049
€ 809,045
€ 816,025
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 25,253
€0
€0
-€ 22,848
-€ 19,138
-€ 3,286
€0
-€ 303
-€ 75,863
€0
-€ 14,089
Rent
Abatements
€0
€0
€0
€0
€0
-€ 3,546
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 662,320
€ 707,037
€ 713,960
€ 689,882
€ 695,671
€ 713,864
€ 725,454
€ 739,725
€ 704,186
€ 809,045
€ 801,936
Nonrecoverable
Costs
-€ 89,391
-€ 90,788
-€ 92,318
-€ 94,780
-€ 103,691
-€ 96,521
-€ 97,977
-€ 99,602
-€ 108,429
-€ 103,371
-€ 104,848
Net
Operating
Income
€ 572,929
€ 616,249
€ 621,642
€ 595,102
€ 591,980
€ 617,343
€ 627,477
€ 640,123
€ 595,757
€ 705,674
€ 697,088
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 9,143
-€ 10,045
€ 553,741
€0
€0
€ 616,249
€0
€0
€ 621,642
€ 574,377
-€ 14,514
-€ 6,211
€0
€ 591,980
€0
-€ 4,781
-€ 68,900
€ 543,662
€0
€ 627,477
€0
€ 640,123
€0
€0
-€ 16,642
-€ 44,614
€ 534,501
€0
€0
€ 705,674
€ 10,921,065
-€ 3,899
-€ 2,116
Present
Value @
7.45%
€ 535,724
€ 554,931
€ 521,095
€ 447,931
€ 430,233
€ 365,710
€ 394,559
€ 374,551
€ 292,619
€ 357,684
€ 5,323,543
€ 9,598,580
€0
€ 9,598,580
8.0%
€ 900000.0
7.4%
€ 800000.0
6.0%
6.4%
6.5%
€ 700000.0
7.0%
6.7%
6.5%
6.4%
6.2%
6.2%
6.2%
6.0%
5.0%
€ 500000.0
4.0%
€ 400000.0
Running yield
Rental income
€ 600000.0
3.0%
€ 300000.0
2.0%
€ 200000.0
1.0%
€ 100000.0
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 640,469
€ 5.68
Market rental value
total p.a.
per m²/month
€ 835,732
€ 7.42
-21.01%
Over-/Underrent
Year 8
Total
€ 9,600,000
per m²
€ 1,022
Purchaser's costs
6.75%
Yield Overview
Net Initial Yield
5.75%
7.75%
Gross Initial Yield
7.12%
9.29%
Total
€ 9,000,000
per m²
€ 958
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. The main tenant, Kaufland Warenhandel Südwest GmbH & Co. KG, has good covenant strength, which
ensures a secure cash flow for the remainder of the lease term until at least 2022. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building age,
third-party usability, competition situation and location.
the previous valuation cycle. Management costs and maintenance costs have been applied according to internal benchmarks.
We have not been provided with updated information regarding necessary capital expenditures (CapEx). According to information received no CapEx are required. For the purpose of our valuation we have
assumed that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 4.50/m² per annum as sinking
fund. Regarding comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the
section "Investment Comparables".
No significant changes occurred in comparison to previous valuation. Only the tenant Bäckerei Staib has extended the lease contract until 09/2014 and the tenant Mutul (12 m²) vacated the property.
Page 10 of 12
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Photos
Front view of the property
Internal view of the sales areas of the tenant Kaufland
View of the mall
Internal view of the sales area of the tenant Deichmann
Entrance to the fitness studio from parking level 2
View of the parking level
Page 11 of 12
abc
Property address
Property no.
7
Portfolio:
Matrix Portfolio
Gartenstraße 30
Valuation date:
31.12.2013
73312 Geislingen
Inspection date:
03.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Kaufland
Kaufland
Kaufland
Deichmann
Deichmann
Bäckerei
Bäckerei
Fitness Company
City
Freital
Lüneburg
Bergkamen
Wiesbaden
Rödermark
Aschaffenburg
Berlin
Bremen
Property Type
Shoe Store
Shoe Store
Bakery
Bakery
Fitness Studio
Area
8,000 m²
4,611 m²
5,956 m²
449 m²
495 m²
66 m²
50 m²
2,430 m²
Total Rent p.m.
€ 62,000
€ 35,732
€ 44,730
€ 5,972
€ 5,361
€ 3,854
€ 3,000
€ 3,013
Rent p. sqm
€ 7.75 /m²
€ 7.75 /m²
€ 7.51 /m²
€ 13.31 /m²
€ 10.83 /m²
€ 58.40 /m²
€ 60.00 /m²
€ 1.24 /m²
Comment
Lower purchasing power; worse location
Bigger retail area; lower purchasing power
Higher purchasing power; smaller retail area
Other federal state
Comparable purchasing power; worse location
Lower purchasing power
Worse location
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
8
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Warenhandel Mittel-Sachsen GmbH & Co. KG
Total lettable area
Total parking units
12,767 m²
450 units
0.1%
7.9 years
1992
n.a.
total p.a.
per m² / month
€ 1,264,953
€ 8.26
total p.a.
per m² / month
€ 115,288
€ 0.75
total p.a.
per m² / month
€ 1,149,664
€ 7.50
total p.a.
€ 1,197,680
5.7%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Sufficient parking
Good accessibility by car
Risk diversification due to multi-tenant structure
Located next to a motorway exit and a federal road
Building almost 22 years old
0
0
Opportunities
Threats
0
0
0
0
Re-letting/negotiations concerning the prolongation of existing contracts may result in worse conditions
Significant negative population growth
Below-average purchasing power
Limited investor focus on properties in eastern Germany
Property is currently let sligthly over market rental level (over-rented)
Building
Location
Building age
Lettable Area
Property condition
General impression
2
4
2
3
16 to 25 years
Between 12,500 and 15,000 m²
Macrolocation
Microlocation
Commercial activity
Competition
2 Slightly overrented (5% to 15%)
Investment market
Investment volume
Saleability
Liquidity
2
3
3
2
Investment Quality
WALT
Over- / underrent
Quality of tenants
4 Good lot size
The site encompasses the subject retail park, a petrol station as well as some food stalls located in front of the main entrance. The property was constructed in 1992 and encompasses a self-service department
store (Kaufland), an Aldi food discounter, a medimax (consumer electronics) and various smaller retailers. The property is rectangular-shaped with the north-western corner being cut out. The property mostly has a
single storey; however, on the eastern side, there is second storey accommodating offices of the main tenant. The unit let by the tenant Aldi has its own entrance located at the south-east of the subject property with
no access to the mall.
The property is built out of prefabricated columns and beams on a reinforced concrete slab. The supporting structure of the flat roof consists of trapezoidal metal panels.
The facade of the property is made from multi-layer concrete panels. Main entrance, office windows and shop displays have coated aluminium frames. The walls within the public areas are plastered and painted.
The ceiling inside the mall is suspended with a grid system still allowing the technical installations above to be seen. The smaller shop units usually have a suspended ceiling while the large retail unit of Kaufland all
technical installations are viewable. The floor is mainly covered with ceramic tiles, while the fit out of the smaller shop units depends on the tenant’s preferences. In terms of HVAC, the property offers gas-operated
heating and ventilation, but only partial air conditioning. The parking area is made of asphalt in the driveways and paving stones for the parking areas.
Valuation Results
Market Value
€ 15,600,000
equals to
Market Rental Value
€ 1,222 per m²
€ 1,197,680 p.a.
Discount Rate
7.25%
Net Initial Yield
7.01%
Capitalisation Rate
7.25%
6.61%
excluding
capital
expenditures
Page 1 of 12
€ 7.82 / m² / p.m.
equals to
7.01%
12.33
6.61%
13.03
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Location
Germany
Saxony
Zwickau (Rural District)
Glauchau
08371
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Glauchau
4,137,051
338,272
24,234
12,631
356
471
-15.5%
-3.0%
-5.3%
9.1%
7.9%
District
City
Federal State
District
District
in m €
in m €
index
index
index
5,738
399
83.30
79.82
98.78
Macro Location
The city of Glauchau is located in the federal state of Saxony. Glauchau is situated between the cities
Gera to the west (approx. 35 km) and Chemnitz to the east (approx. 30 km). Glauchau is located next to
the motorway A4, which runs from the east of Hesse to the Polish border, passing by cities such as
Erfurt, Chemnitz and Dresden. Furthermore, the federal roads B175 and B93 cross Glauchau,
connecting the city from north and south.
Glauchau has a railway station with service to Dresden, Hof, Nuremberg and Zwickau, connecting the
city to the long-distance network of Deutsche Bahn.
The closest airport is Leipzig-Altenburg, which is situated 20 km north of Glachau. Destinations to be
reached from Leipzig airport are nationally, larger German cities in the west and south of Germany and
internationally, Brussels, Prague, Paris and Vienna. Furthermore, Leipzig offers service to plenty of
tourist destinations, such as Spain, Greece and North Africa. Glauchau is home to several
manufacturing companies in the field of textiles and car parts. Particularly the latter sector benefits from
the manufacturing site of Volkswagen in Zwickau-Mosel only a couple of kilometres away. Additionally,
Glauchau benefits from its location next to a motorway.
Micro Location
Micro Location
The property is situated approx. 2.5 km north of the city centre of Glauchau in the sub-district of Jerisau.
The property is located very close to a motorway exit (A4) and the federal road B175, connecting the city
in all directions. The property is visible from both roads. It can be accessed from Ludwig-Erhard-Straße
in the north and Waldenburger Straße in the east, surrounding the property to the west, north, and east.
To the south of the property, there is a Greenfield site. The neighbourhood of the property is
predominantly characterised by commercial buildings, such as car dealerships, a fast food restaurant,
and fields. Furthermore, there is a petrol station on the site.
There is a bus stop in front of the site with frequent service from Glauchau to a couple of villages and
town to the north and east of the property.
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
490
3.5
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
47,878 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
No
Comment
The site consists of ten different plots and encompasses a total of 47,878 m². The site is not listed in the
register of contaminated land ("Altlastenkataster") and the environmental DD, dated 2nd May 1991
prepared by Institut Fresenius GmbH, did not identify any contamination of the site.
In terms of easements, all plots have an easement registered in favour of Kaufland to operate its store.
This represents a common practice so that we do not attribute any effect on value to it. Furthermore,
three other easements secure the right to build an underground water pipe on some of the plots. Again,
we do not believe that this will influence the market value of the property.
Town Planning
Use class
SO (special zone)
n.a.
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
According to information from the local planning authority's website, a legally binding development plan
exists, entitled "Einkaufszentrum Glauchau Waldenburgerstr." with the following regulations: the subject
site is located in a special retail zone (Sondergebiet Einkaufszentrum). It imposes the following
restrictions, among others: approx. 13,000 m² of retail space is permissible, of which a maximum of
5,500 m² can be used for food retailing, 6,400 m² for non-food retailing, and 3,200 m² for ancillary
rooms. Additionally, up to 2,000 m² of office space is permissible.
Tenure
Land Register
Local Court of
Hohenstein-Ernstthal,
land register of
Glauchau
Owner
TPL Glauchau S.á.r.l,
Luxembourg
Sheet
5177
8599
4303
Plot
n.a.
n.a.
n.a.
Parcel
Sheet 5177:
220/3, 217/4,
213/3, 213/4,
232/9, 220/5,
220/6, 219/11;
Sheet 8599:
219/6;
Sheet 4303: 219/7
Section 3 (Loans)
Sheet 5177:
Easement (pipeline installation and use as
storage space) for the respective owner of the
entered on 21.02.2012
parcels 220, 219/4 and 219/5 (Jerisau district);
Comprehensive right of use to operate a
supermarket/self-service department for Kaufland
Dienstleistung GmbH & Co. KG, Neckarsulm;
Freshwater pipeline easement for Regionaler
Zweckverband Wasserversorgung Bereich LugauGlauchau, Glauchau;
Sheet 8599 and 4303:
Comprehensive right to operate a
supermarket/self-service department for Kaufland
Dienstleistung GmbH & Co. KG, Neckarsulm
Page 3 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Simmel
Kaufland
Simmel
Kaufland
Kaufland
Simmel
0
Address
8371 Glauchau, Rudolf-Breitscheid-Str. 10
8393 Meerane, Seiferitzer Allee 1
8393 Meerane, August-Bebel-Str. 65
8371 Glauchau, Grenayer Str. 10
8451 Crimmitschau, Harthauer Weg 1
9350 Lichtenstein, Platanenstr. 4
Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Sales area
2,300 m²
4,847 m²
1,600 m²
4,200 m²
3,525 m²
2,000 m²
m²
Distance
1.80 km
6.30 km
5.30 km
2.40 km
9.10 km
9.00 km
Potential
Medium
High
Low
Low
Low
Low
0
0
0
0
0
0
28,504
45,410
14,800
22,998
79.82
Page 4 of 12
5,738
16,486
7.9%
-15.5%
98.78
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
8
Main competitors
This competitor is a retail park located at the western outskirts of Glauchau, only 3 km away from the
subject property. It comprises a Kaufland, a toom DIY, a large-scale drinks cash-and-carry, a Reno
shoe market, a tedi, a petrol station and various smaller retailers. Due to the proximity and similarity
of the tenant mix, we assess the competition level to be high.
This medium-sized Edeka store is located within a small retail park with several small retailers such as
NKD, a local shoe store and Pfennigpfeiffer (a discount store for non-food items, for example stationery
and houseware).
Competition Comment
Concerning food competitors, there is the aforementioned retail park anchored by Kaufland (named Kaufland II in the following) and toom DIY at the western outskirts of Glauchau and the E-Center Simmel located
within Glauchau. Of these two and the Kaufland in the subject property, the latter one has the largest sales area with more than 7,000 m². Its competitors only have approx. 4,200 m² (Kaufland II) and 2,300 m² (ECenter) of space. On the other hand, the Kaufland II is part of a larger retail agglomeration with a toom DIY, a large-scale drinks cash-and-carry, a Reno shoe market, a tedi, a petrol station and various smaller
retailers. Furthermore, a petrol station is next to the agglomeration. The E-Center is part of a smaller retail agglomeration with a couple of smaller retailers, predominantly from the region. Generally, shop units are
smaller within this agglomeration compared to the properties in which the Kauflands are located in.
However, the E-Center is only an indirect competitor to Kaufland, since the sales area is significantly smaller. Furthermore, Kaufland offers a very deep and broad product range with more than 50,000 products,
while discounters and supermarkets offer a limited product range with only 7,000 to 11,000 (supermarkets) or 400-2,500 (discounters) articles. Therefore, these retailing forms address different customers or
customer needs. While supermarkets and discounters cater to the daily needs of customers, Kaufland offers a larger variety of products that are bought on a non-daily basis.
Thus, the only very strong competitor is Kaufland II. In terms of location, Kaufland II benefits from its location next to the B175, which leads out of Glauchau to Zwickau and to the Volkswagen manufacturing site
close by. However, the accessibility of the site is below average and the visibility from the road from a distance is below average. Additionally, the different larger shops are not connected to each other via a mall as
in the subject property. This means that customers have to walk through the parking lot to get to the next shop.
Moreover, Kaufland II does not have a food discounter, which usually attracts many customers who go shopping in hypermarkets for the goods they cannot buy in food discounters. Furthermore, when considering
the inner and outer appearance of the shops, they are both almost on the same level as the subject property.
Particularly to the north of the property, there are no competitors and this area is connected via a major federal road. Therefore, we believe that there is enough customer potential for Kaufland.
Turnover analysis
The rents in a functional retail agglomeration are linked to turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This rate
normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m².
For the previous valuation we have been provided with turnover figures from the tenant Kaufland. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a
turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store.
Hence, we believe that a higher market rent is achievable after the end of the lease contract.
Though turnover is low, the turnover-rent ratio is in an acceptable range. Nevertheless, we consider the rents paid in the property to be at the upper end of the range of acceptable ratios. On the other hand, the
rents paid are considered to be generally sustainable.
With regards to the turnover rents, apart from some exceptions, we believe that there will be no significant and sustainable increases in turnover. Thus, in the valuation we considered only turnover rents when the
level of turnover was sustainable over a long period of time.
Conclusion
The subject property is a retail park located in the northern outskirts of Glauchau at an arterial road, close to a motorway exit. It offers good visibility and accessibility by car. The property is anchored by a Kaufland
and comprises other nation-wide operating retailers such as Aldi, medimax, Deichmann, Apollo Optik, AWG, mister+lady and some local retailers.
The tenant mix within the property predominantly focuses on price-conscious customers and offers products ranging from daily needs to fashion and services, such as a dry cleaner, a locksmith, and jeweller. This
tenant mix fits into the general economic environment of the region.
On the other hand, the tenant mix is quite similar to that of the strongest competitor (Kaufland II). Nevertheless, the subject property benefits from the villages to the north, which act as additional customer potential
and help sustain the market. Furthermore, the subject property benefits of the presence of Aldi within the property since food discounters usually attract a large number of people who could be potential customers at
the other shops as well.
The tenants within the property, apart from the food stalls, suffer from below average turnover, likely because of the low purchasing power in the region. Nevertheless, based on the turnover data made available to
us, we believe that the total rental income is sustainable. The property is nearly fully let and achieves an average contractual rent of € 8.68/m² for the retail areas. Furthermore, the weighted average lease term is
8.1 years with the anchor tenant having a remaining lease term of more than 10 years.
All in all, the property has an adequate tenant mix and is let on a sustainable level. Nevertheless, the strong competition and economic situation in the region does not leave much room for rental growth potential.
Page 5 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 BRL Center GmbH
Area Category
Letting
Status
Area
m² / unit
175
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
€ 4,788
27.36
Yes
01.08.2008
31.07.2028
75%
GT I PM
2 Friedrich
Retail
Let
13
€ 577
43.06
Yes
06.09.2007
30.09.2017
75%
GT I PM
3 mister*lady GmbH
Retail
Let
336
€ 2,136
6.36
Yes
25.07.2000
31.07.2016
75%
GT I PM
Retail
Let
78
€ 2,440
31.21
Yes
01.03.2009
28.02.2024
75%
GT I PM
5 Röhner
Retail
Let
73
€ 991
13.67
Yes
01.04.2005
31.03.2015
75%
GT I PM
6 Valora Retail Kiosk GmbH
Retail
Let
29
€ 799
27.61
Yes
01.12.2010
31.12.2016
75%
GT I PM
Retail
Let
67
€ 1,635
24.50
Yes
15.12.2012
31.12.2017
75%
GT I PM
8 Deichmann SE
Retail
Let
435
€ 7,786
17.90
Yes
13.10.1992
31.10.2014
75%
GT I PM
9 Fleischerei Richter GmbH
Retail
Let
82
€ 3,300
40.34
Yes
21.06.2008
30.06.2022
75%
GT I PM
10 Apollo Optik GmbH
Retail
Let
125
€ 1,558
12.47
Yes
02.11.2005
01.11.2015
75%
GT I PM
11 Dänisches Bettenlager GmbH & Co. KG
Retail
Let
978
€ 4,980
5.09
No
11.12.2013
11.12.2018
75%
12 Flora Passionata
Retail
Let
58
€ 1,428
24.62
Yes
01.04.2009
31.03.2015
75%
GT I PM
13 Kaufland Warenhandel Mittel-Sachsen GmbH & Co. KG
Retail
Let
7,140
€ 39,268
5.50
Yes
01.10.2007
30.09.2026
75%
14 Wiener Feinbäckerei Heberer GmbH Weimar
Retail
Let
79
€ 4,419
56.29
Yes
01.06.2001
31.05.2016
75%
Retail
Let
890
€ 8,277
9.30
Yes
01.03.2002
28.02.2017
75%
16 MediMax Zentrale Electronic GmbH
Retail
Let
1,546
€ 10,027
6.49
Yes
01.12.2004
07.05.2019
75%
Storage
Let
442
€ 2,210
5.00
Yes
01.10.2007
30.09.2026
75%
Office
Let
55
€ 275
5.00
Yes
01.10.2007
30.09.2026
19 Sparkasse Chemnitz Abt. Verwaltung
Other Units
Let
4
€ 273
68.22
Yes
26.04.1993
31.03.2015
75%
Other Units
Let
1
€ 433
433.33
Yes
01.01.2010
31.12.2014
100%
21 Cakir
Other Units
Let
24
€ 607
25.31
Yes
01.04.2006
31.03.2016
75%
22 Dung Tran
Other Units
Let
24
€ 750
31.25
Yes
01.11.2005
30.06.2014
75%
Petrol Station
Let
1,139
€ 2,073
1.82
Yes
01.04.2003
31.03.2018
100%
M GT I PM
Yes
15.03.2011
14.03.2016
75%
GT I PM
Yes
01.10.2007
30.09.2026
75%
00.01.1900
30.09.2026
75%
00.01.1900
00.01.1900
0%
24 Apache-Jeans
Retail
Let
150
€ 2,027
13.50
25 Vacant
Retail
Vacant
17
€0
0.00
Other Units
Let
1
€ 880
880.00
Other Units
Let
1
€ 144
144.00
External parking
Let
450
€0
0.00
Let
8
26 Kiosk
27 Mall Income
28 Parking
Yes
GT I PM
GT I
GT I PM
75%
0%
Other Units
€ 1,000
133.33
n.a.
01.01.2009
31.01.2017
75%
M GT I PM
30 Tobaco
Other Units
Let
1
€ 15
300.00
#NV
01.09.2013
31.08.2016
100%
M GT I PM
31 Gottmann Kay
Other Units
Let
1
€ 15
15.00
75
01.10.2009
30.04.2014
75%
M GT I PM
32 Geiser Roland GmbH
Other Units
Let
1
€ 300
300.00
n.a.
01.08.2011
31.07.2016
75%
M GT I PM
13,906 m²
€ 105,413
Total
Page 6 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Area Category
Tenant Name
Area
sqm/unit
Market
Rent
Market
Rent /month
€ 4,375
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
1 BRL Center GmbH
Retail
175
€ 25.00
€ 100
0
6
0
3
5
25%
2 Friedrich
Retail
13
€ 30.00
€ 402
€ 100
0
6
0
3
5
25%
3 mister*lady GmbH
Retail
336
€ 7.00
€ 2,352
€ 100
0
12
0
3
5
25%
Retail
78
€ 25.00
€ 1,955
€ 100
0
6
0
3
5
25%
5 Röhner
Retail
73
€ 17.50
€ 1,269
€ 100
0
9
0
3
5
25%
6 Valora Retail Kiosk GmbH
Retail
29
€ 30.00
€ 869
€ 100
0
6
0
3
5
25%
Retail
67
€ 30.00
€ 2,003
€ 100
0
6
0
3
5
8 Deichmann SE
Retail
435
€ 12.50
€ 5,438
€ 100
0
12
0
3
5
25%
Retail
82
€ 30.00
€ 2,454
€ 100
0
6
0
3
5
25%
10 Apollo Optik GmbH
Retail
125
€ 12.50
€ 1,562
€ 100
0
9
0
3
5
25%
Retail
978
€ 7.50
€ 7,335
€ 100
0
12
0
3
10
25%
12 Flora Passionata
Retail
58
€ 30.00
€ 1,740
€ 100
0
6
0
3
5
25%
Retail
5
25%
7,140
€ 5.50
€ 39,268
€ 50
0
14 Wiener Feinbäckerei Heberer GmbH Weimar
Retail
79
€ 30.00
€ 2,355
€ 100
0
6
0
3
5
25%
Retail
890
€ 8.50
€ 7,569
€ 100
0
12
0
3
5
25%
16 MediMax Zentrale Electronic GmbH
6
0
3
25%
Retail
1,546
€ 6.00
€ 9,274
€ 50
0
6
0
3
10
25%
Storage
442
€ 5.00
€ 2,210
€ 100
0
6
0
3
5
25%
€ 100
Office
55
€ 5.00
€ 275
5
25%
19 Sparkasse Chemnitz Abt. Verwaltung
Other Units
4
€ 68.22
€ 273
€0
0
3
0
3
5
25%
Other Units
1
€ 433.33
€ 433
€0
0
6
0
3
5
0%
21 Cakir
Other Units
24
€ 30.00
€ 720
€0
0
6
0
3
5
25%
25%
0
6
0
3
Other Units
24
€ 30.00
€ 720
€0
0
6
0
3
5
Petrol Station
1,139
€ 1.82
€ 2,073
€0
0
0
0
3
10
24 Apache-Jeans
Retail
150
€ 15.00
€ 2,252
€ 100
0
12
0
3
5
25%
25 Vacant
Retail
17
€ 5.50
€ 94
€0
0
0
0
3
5
75%
22 Dung Tran
0%
26 Kiosk
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
25%
27 Mall Income
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
25%
External parking
450
€ 0.00
€0
€0
0
0
0
0
0
0%
Other Units
8
€ 30.00
€ 225
€0
0
6
0
3
5
25%
28 Parking
€ 15
€0
0
0
0
3
31 Gottmann Kay
Other Units
1
€ 0.00
€0
€0
0
3
0
0
5
25%
32 Geiser Roland GmbH
30 Tobaco
Other Units
Other Units
1
€ 300.00
€ 300
€0
0
0
0
3
5
25%
Total
* months
1
€ 15.00
13,906 sqm
** years
0
0%
€ 99,807
Page 7 of 12
.
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
55
12,270
0
0
0
0
442
12,767
1,139
66
0
450
1,655
Area Vacant
m²
0
17
0
0
0
0
0
17
0
0
0
0
0
Area Let
m²
55
12,253
0
0
0
0
442
12,750
1,139
66
0
450
450
Vacancy Rate
%
0.00%
0.14%
0.00%
0.00%
0.00%
0.00%
0.00%
0.13%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
5.00
7.87
0.00
0.00
0.00
0.00
5.00
1.82
67.44
8.27
0.00
0.00
Contractual
Rent
€/month
275
96,437
0
0
0
0
2,210
2,073
4,418
105,413
0
0
Contractual
Rent
€/year
3,300
1,157,244
0
0
0
0
26,520
24,877
53,011
1,264,953
0
0
Potential
Rent
€/year
3,300
1,158,783
0
0
0
0
26,520
24,877
53,011
1,266,491
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
5.00
7.54
0.00
0.00
0.00
0.00
5.00
1.82
41.01
7.82
0.00
0.00
Market
Rent
€/year
3,300
1,110,748
0
0
0
0
26,520
24,877
32,234
1,197,680
0
0
Market
Rent
€/month
275
92,562
0
0
0
0
2,210
2,073
2,686
99,807
0
0
Over-/ UnderRented
0.0%
4.3%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
64.5%
5.8%
0.0%
0.0%
Space productivity
7,000
Explanation
13.00
12.00
6,500
11.84
Market rent
11.00
6,000
Contractual Rent
10.00
Rent / m² / month
5,500
5,000
4,500
9.00
Rents
8.88
8.00
7.00
6.00
5.92
5.50
€ / m²
%
Contractual
1.9%
5.50
Market
1.9%
5.50
4% of turnover
11.84
3% of turnover
8.88
5.00
4,000
5.92
2% of turnover
4,227
4.00
3,500
Turnover potential
(net)
3.00
3,000
2.00
1.0%
in € / m² p.a.
25,359,998 €
Sales Area
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 6,000 m²
7,140 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Warenhandel Mittel-Sachsen GmbH & Co. KG
€ 501,036
40%
12.7 years
80
O1
1
92
€ 8,000 (single) € 38,000 (total)
area is food retailing with branded goods and own-brands specially produced for Kaufland.
According to Dun & Bradstreet (D&B) Rating as of 29.01.2014 Kaufland Warenhandel Mittel-Sachsen
GmbH & Co. KG has a very low credit risk. The risk of insolvency (D&B Score) within the next 12 months
compared with other German companies is assessed to be low.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
8
Market Value
The main tenant, Kaufland, has a lease expiring in 2026 with the option to prolong its lease. The rent is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation
to CPI basis. Kaufland does not contribute to any costs in association with maintenance costs for roof and the building structure, ground tax, insurance fees, and management costs. The remaining tenants usually
do not pay for maintenance costs for roof and building structure and pay a fixed amount each month for management costs (usually around € 100). However, most tenants pay for ground tax and insurance fees.
The rent is mostly indexed with 75% to 100% adjustment of the rent whenever the German CPI changes by 10% or more. Some of the tenants have an option to prolong their leases by five years.
The spaces of Aldi and Ziesche has been relet to Dänisches Bettenlager until 12/2018. Further the tenant Dänisches Bettenlager has taken 60 m² from adajcent tenants "Deichmann" and "AWG" in exchange for 2
vacant units of 30 m² each.
Discount rate
7.25%
Capitalisation rate
7.25%
account such facts as the stable Cash Flow, the long lease contract with the tenant Kaufland, the
average location within the federal state Saxony and the low vacancy rate.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.49 /m²
€ 1.75 /m²
€ 0.29 /m²
€ 0.00 /m²
€ 9.03 /m²
€ 70,218
€ 18,974
€ 22,351
€ 3,746
€0
€ 115,288
per year
per year
€ 5.50 /m²
€ 1.41 /m²
€ 1.75 /m²
€ 0.29 /m²
€ 0.00 /m²
€ 8.95 /m²
€ 70,218
€ 17,965
€ 22,351
€ 3,746
€0
€ 114,279
Inflation
% of Gross
Contract Rent
5.55%
1.50%
1.77%
0.30%
0.00%
9.11%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.86%
1.50%
1.87%
0.31%
0.00%
9.54%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 70,244
€ 71,368
€ 72,638
€ 73,916
€ 75,114
€ 76,301
€ 77,521
€ 78,777
€ 80,022
€ 81,206
€ 82,392
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 18,797
€ 18,541
€ 18,665
€ 18,255
€ 18,629
€ 18,893
€ 19,166
€ 19,575
€ 19,682
€ 20,180
€ 20,113
Insurance
Costs
€ 3,746
€ 3,805
€ 3,873
€ 3,941
€ 4,005
€ 4,068
€ 4,134
€ 4,201
€ 4,267
€ 4,330
€ 4,393
Ground
Tax
€ 22,351
€ 22,709
€ 23,113
€ 23,520
€ 23,901
€ 24,278
€ 24,667
€ 25,066
€ 25,462
€ 25,839
€ 26,216
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 115,996
€ 119,783
€ 119,838
€ 122,098
€ 121,819
€ 126,278
€ 126,981
€ 129,101
€ 132,565
€ 131,752
€ 133,322
Vacancy
Costs
€ 858
€ 3,360
€ 1,549
€ 2,466
€ 170
€ 2,738
€ 1,493
€ 1,482
€ 3,132
€ 197
€ 208
% of Total
Gross Revenue
9.3%
9.7%
9.6%
10.0%
9.8%
10.0%
9.9%
9.9%
10.1%
9.8%
9.9%
12.0%
10.0%
9.3%
9.7%
9.6%
10.0%
9.8%
10.0%
9.9%
9.9%
10.1%
9.8%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,266,162
€ 1,268,440
€ 1,266,738
€ 1,244,154
€ 1,246,231
€ 1,285,247
€ 1,302,464
€ 1,328,484
€ 1,349,488
€ 1,350,475
€ 1,347,145
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 13,042
-€ 32,393
-€ 22,431
-€ 27,149
-€ 4,285
-€ 25,721
-€ 24,741
-€ 23,465
-€ 37,336
-€ 5,109
-€ 6,310
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,253,120
€ 1,236,047
€ 1,244,307
€ 1,217,005
€ 1,241,946
€ 1,259,526
€ 1,277,723
€ 1,305,019
€ 1,312,152
€ 1,345,366
€ 1,340,835
Nonrecoverable
Costs
-€ 115,996
-€ 119,783
-€ 119,838
-€ 122,098
-€ 121,819
-€ 126,278
-€ 126,981
-€ 129,101
-€ 132,565
-€ 131,752
-€ 133,322
Net
Operating
Income
€ 1,137,124
€ 1,116,264
€ 1,124,469
€ 1,094,907
€ 1,120,127
€ 1,133,248
€ 1,150,742
€ 1,175,918
€ 1,179,587
€ 1,213,614
€ 1,207,513
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
€0
-€ 546
€ 1,136,578
-€ 33,994
-€ 13,641
€ 1,068,629
-€ 17,826
-€ 7,233
€ 1,099,410
€ 1,063,168
-€ 24,539
-€ 7,200
-€ 1,784
€ 1,116,733
-€ 1,610
-€ 6,670
-€ 26,789
€ 1,099,789
-€ 7,039
€ 1,128,101
-€ 15,602
€ 1,160,154
-€ 9,913
-€ 5,851
-€ 11,598
-€ 38,082
€ 1,129,907
-€ 2,316
-€ 2,094
€ 1,209,204
€ 16,732,041
-€ 1,728
-€ 2,293
Present
Value @
7.25%
€ 1,101,329
€ 965,577
€ 926,114
€ 834,435
€ 817,409
€ 749,926
€ 717,660
€ 688,513
€ 625,325
€ 623,767
€ 8,309,520
€ 16,359,575
€0
€ 16,359,575
8.0%
€ 1600000.0
7.4%
7.0%
6.8%
6.9%
6.7%
7.0%
6.9%
6.8%
7.2%
7.0%
€ 1200000.0
6.0%
€ 1000000.0
5.0%
€ 800000.0
4.0%
€ 600000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
1.0%
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,264,953
€ 8.26
Market rental value
total p.a.
per m²/month
€ 1,197,680
€ 7.82
5.72%
Over-/Underrent
Year 8
Running yield
Rental income
€ 1400000.0
7.2%
Total
€ 16,400,000
per m²
€ 1,285
Purchaser's costs
5.00%
Yield Overview
Net Initial Yield
7.01%
6.61%
Gross Initial Yield
8.11%
7.68%
Total
€ 15,600,000
per m²
€ 1,222
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. The main tenant, Kaufland Warenhandel Mittel-Sachsen GmbH & Co. KG, has good covenant strength,
which ensures a secure cash flow for the remainder of the lease term until at least 2026. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building
age, third-party usability, competition situation and location.
In terms of the market rent of Kaufland, our analysis shows that Kaufland could afford to pay a higher rent of approx. € 6.40/m²/month. However, taking the highly negative population growth forecast for the coming
years into account as well as the strong competition, we decreased the market rent accordingly to € 5.50/m²/month.
For the purpose of the valuation on 31.12.2013, we have been provided with an updated rent roll and applied it in our valuation. The contractual rental income decreased, other costs have remained unchanged and
have been applied according to the information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent. We have not been provided with updated
information regarding necessary capital expenditures, therefore we applied that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be
covered by the our maintenance cost approach of € 5.50/m² p.a. Regarding comparable rents, we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we
have analysed comparable transactions. Please refer to the section "Investment Comparables". Compared to our last valuation, some changes in the rent roll have been made as well as an adjustment of the nonrecoverable costs.
The following changes occurred in comparison to previous valuation: The areas of the tenants Aldi and Ziesche has been relet to Dänisches Bettenlager (978 m²). The lease stated in December 2013 with a rent of
€ 5.09/m² and will remain until December 2018. Further the tenant Dänisches Bettenlager has taken 60 m² from adajcent tenants Deichmann and AWG in exchange for 2 vacant units of 30 m² each.
Page 10 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Photos
View from main entrance to the mall
Sales area of Kaufland
View of the mall
View of the former Aldi with separate entrance
View of the petrol station on site
Page 11 of 12
abc
Property address
Property no.
8
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
08371 Glauchau
Inspection date:
01.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Marktkauf
Real
Wal Mart
Real
Deichmann
AWG
Frisör Klier
0
City
Mühlhausen
Braunschweig
Salzgitter
Bitterfeld
Görlitz
Großpösna
Großpösna
0
Property Type
Shoes
Fashion
Haircutter
0
Area
1,800 m²
19,688 m²
6,250 m²
16,866 m²
504 m²
1,435 m²
88 m²
0 m²
Total Rent p.m.
€ 8,136
€ 104,150
€ 38,750
€ 115,532
€ 5,670
€ 16,373
€ 2,236
€0
Rent p. sqm
€ 4.52 /m²
€ 5.29 /m²
€ 6.20 /m²
€ 6.85 /m²
€ 11.25 /m²
€ 11.41 /m²
€ 25.41 /m²
€ 0.00 /m²
Comment
Other federal state
Significantly better purchasing power
Rental income includes sub tenants with higher rents
Slightly worse purchasing power
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
9
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Vertrieb ALPHA GmbH & Co. KG
Total lettable area
Total parking units
14,144 m²
299 units
0.0%
7.9 years
1997
n.a.
total p.a.
per m² / month
€ 1,013,225
€ 5.97
total p.a.
per m² / month
€ 133,838
€ 0.79
total p.a.
per m² / month
€ 879,386
€ 5.18
total p.a.
€ 1,332,505
-24.0%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Located along a major through road
Strong and well-known anchor tenant with long remaining lease term
Good tenant mix
Fully let
0
0
Opportunities
Threats
Reletting of the main retail area on market level
0
0
0
Difficult relettability of the fitness studio/health center
0
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
2
4
3
3
16 to 25 years
Between 12,500 and 15,000 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
3
2
3
No commercial activity nearby
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The property consists of two buildings. The main building was built in 1997 and is a multifunctional building complex with two underground levels and one to five storeys. The main tenant, Kaufland, is located in the
main building, as is the health centre and some minor office areas. The building comprises four connected building parts, which extend from west to east: Part A is a five-storey building with one basement, which
has a triangular shape and is the location of the main entrance to the mall. This building part is mainly let to medical practices. Part B is an L-shaped one- to two-storey building with a basement level and in parts, a
second basement level. The main part of the mall is located here. Building part C has two storeys, one basement level and a rectangular shape. The ground level is occupied by the shopping mall, while the first
floor is let to the fitness studio. Building part D is rectangular, has four-storeys and comprises residential units.
The main building is a skeleton construction with columns and beams in varying grids. On the upper floors, there are reinforced concrete slabs and a ripped ceiling over the basement. The inner and outer walls are
made of reinforced brickwork or concrete, and are partly constructed as a multi-layer construction or covered with plaster. The annex was completed in 2007. It has three storeys and a rectangular shape. The
annex is let to medical practices and office tenants on the first floor. There are three retail units on the ground floor and several residential units on the other floors. There are two parking levels under the main
building accessible from Friedrichstraße. Some additional parking is provided in front of the annex and is accessible from Danziger Straße.
Valuation Results
Market Value
€ 13,600,000
equals to
Market Rental Value
€ 962 per m²
€ 1,332,505 p.a.
Discount Rate
6.50%
Net Initial Yield
6.06%
Capitalisation Rate
6.25%
8.23%
excluding
capital
expenditures
Page 1 of 12
€ 7.85 / m² / p.m.
equals to
6.06%
13.42
8.23%
10.21
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Location
Germany
Baden-Wurttemberg
Ludwigsburg (Rural District)
Ludwigsburg
71638
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Ludwigsburg
10,786,227
521,014
88,673
40,594
759
2046
4.3%
0.3%
1.0%
3.9%
3.8%
District
City
Federal State
District
District
in m €
in m €
index
index
index
12,725
2,044
107.20
111.80
81.20
Macro Location
Ludwigsburg is located in the centre of Baden-Wuerttemberg, only 12 km north from the state capital,
Stuttgart (602,000 inhabitants). It is the district capital of the Ludwigsburg District and the second biggest
secondary centre in the federal state.
The closest motorways are the A81 (Würzburg - Gottmadingen) and A8 (Perl - Bad Reichenhall), which
connect the region to Salzburg, Austria to the south-east. The motorways can be reached within 5 km
and 20 km, respectively.
Ludwigsburg has a railway station, which is located approx. 2 km from the subject property and offers
connections to regional destinations such as Stuttgart. The closest railway station offering connections
to the high-speed ICE train network is in Stuttgart, approx. 13 km away.
The nearest airport offering connections to national and international destinations is the Stuttgart Airport,
located approx. 22 km from the subject property.
The economy of Ludwigsburg is based on five sectors: automotive suppliers, mechanical engineering,
financial services, software development, and communication media. Additionally, a new field is
currently establishing itself in Ludwigsburg, namely companies with future-oriented businesses such as
energy efficiency, eco-design and green industry. Well-known companies based in Ludwigsburg include
Beru Ag, Gleason-Pfauter GmbH, Wüstenrot Bausparkasse AG and Mann+Hummel GmbH.
Micro Location
Micro Location
The property is less than 2 km from Ludwigburg's city centre. It is located at the intersection of Danziger
Straße and Friedrichstraße (L1140), a well-frequented east-west axis. The property is highly visible from
both Friedrichstraße and Danziger Straße due to its corner location. The surrounding are is
characterized by residential use with minor commercial use on the ground floor level.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
360
5.0
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
10,911 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
Yes
Comment
According to the Environmental Due Diligence Report, dated July 2007, both sites are listed in the
contaminated land register, "Atlas altlastverdächtiger Flächen des Landratsamtes Ludwigsburg". The
sites were formerly used by the US military as a military base. It is not clear whether the grounds were
contaminated, as neither subsoil investigation reports nor remediation reports were available. Kaufland
has stated that there is no subsoil contamination up to 10 m below ground level; however, it is not clear
whether there is contamination below this point. For the purposes of this valuation, we have assumed
that the subject property is free of any soil or building contamination.
Town Planning
Use class
SO (special zone)
0,9
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
entitled "048/01" and dated 30.09.1995, with the following regulations: the subject site is listed as a
special area (SO-Sondergebiet "Einkaufszentrum"), which permits large-scale retail trade. The site
coverage ratio (Grundflächenzahl, GRZ) is 0.9. The maximum height of the buildings is limited to 27.5 m
for the corner building and 17.5 m for the middle part of the building and 15 m for the annex.
Tenure
Land Register
Owner
Local Court of
TPL Ludwigsburg
Ludwigsburg, land
S.á.r.l., Luxembourg
register of Ludwigsburg
Sheet
25568
Plot
NO 3611 (VN
1998/2)
NO 3611 (VN
1993/71)
Parcel
1330/2
1330/89
Section 3 (Loans)
temporary restrictive covenant, right of wayleave, favour of Corealcredit Bank AG, Frankfurt am Main;
restrictive covenant, pipeline easement, building entered on 29.06.2011
restrictions concerning antennas and combustion
installations, right to maintain a sidewalk on part
of the property, right to operate and maintain a
central heating system) in favor of the city of
Ludwigsburg. Further limited personal easements
(regarding the installation/operation of a
transformer station, pipeline easement, the
installation and operation of a distribution plant)
are in favour of Neckarwerke
Elektrizitätsversorgungs-AG, Esslingen and
Deutsche Telekom AG, Stuttgart. One limited
personal easement (the right to operate and
maintain a hypermarket) in favor of Kaufland
Dienstleistungs GmbH&Co. KG, Neckarsulm.
Page 3 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Rewe
Rewe
Kaufland
Rewe
E-center
Marktkauf
E-center
Rewe
Kaufland
Rewe
E-center
Kaufland
Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Address
70806 Kornwestheim, Arkansasstr. 2
71638 Ludwigsburg, Wilhelmstr. 24
71636 Ludwigsburg, Schwieberdinger Str. 94
70806 Kornwestheim, Neckarstr. 1
70806 Kornwestheim, Bahnhofsplatz 2-4
71679 Asperg, Ruhrstr. 6
71686 Remseck, Neckaraue 2
71679 Asperg, Eglosheimer Str. 72
70378 Stuttgart, Aldinger Str. 70
70736 Fellbach, Daimlerstr. 18
70435 Stuttgart, Stammheimer Str. 10
71672 Marbach, Rielingshäuser Str. 15
Sales area
1,500 m²
1,500 m²
7,620 m²
1,600 m²
2,026 m²
2,746 m²
3,400 m²
1,500 m²
4,800 m²
2,800 m²
3,800 m²
2,300 m²
Distance
1.50 km
1.70 km
2.90 km
2.90 km
3.50 km
4.50 km
4.50 km
5.00 km
5.60 km
6.40 km
6.80 km
7.30 km
Potential
Low
Low
High
Low
Low
Medium
Medium
Low
Medium
Low
Low
Low
148,314
12,725
402,904
23,612
67,909
191,962
111.80
3.8%
4.3%
81.20
Page 4 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
9
Main competitors
This competitor is a large-scale retail property let to the tenant Kaufland. The property is located in a
commercial area at the western periphery of Ludwigsburg. A Küchenstudio and an Aral petrol station
are located next to the property.
The location of the property is very good and it benefits from being next to a highly-frequented road
leading to the A81 motorway. The property is comparable to the subject property and therefore, has a
high competition potential.
Competition Comment
The catchment area can be differentiated into primary (Radius 5 km) and secondary (Radius 10 km) catchment areas. Approximately 148,314 inhabitants live in the primary catchment area.
Even though there are several discounters and small-scale supermarkets located nearby, it can be said that these present only indirect competition to the property. Kaufland offers a very deep and broad product
range with more than 50,000 products, while supermarkets and discounters generally offer a limited product range with only 7,000 to 11,000 (supermarkets) or 400-2,500 (discounters) articles. Therefore, these
retailing forms address different customers or customer needs. While supermarkets and discounters cater to the daily needs of customers, Kaufland offers more variety for products that are bought on a non-daily
basis.
The main competitor in Ludwigsburg is another Kaufland self-service department store located along Schwieberdinger Straße in the district Pflugfelden. It is located in a commercial area approx. 3 km west of the
The mix of the ancillary tenants is comparable to the sublets of Kaufland in the subject property. The property was refurbished in 2009/2010. The split of the retail area over two storeys is a bit problematic, as it
forces consumers to walk longer distances. Other than that, the proximity of this competitor to the subject property and the superior location along a commuter road make this retail property a serious competitor with
high competition potential.
There are three more Rewe hypermarkets in a radius of 3 km. However, as these have barely half the sales area of the subject property and offer a different product mix, they only represent indirect competition.
0
Turnover analysis
normally ranges between 2% and 15% depending on the respective branch. The productivity varies between approx. € 1,000/m² up to more than € 10,000/m².
In the subject property, there are only four retail areas: the retail areas of Kaufland, Corongiu, Sardovino and Aro Heimtextilien GmbH. No turnover rents have been agreed with the tenants Corongiu and Sardovino;
we have therefore not been provided with any turnover figures.
For Kaufland, we have been provided with turnover figures. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it
lies below the range of 2% to 4%, which is acceptable for a self-service department store. Considering the location factors and the competition level within Ludwigsburg, we have assumed that a higher turnover-torent ratio regarding a similar branch and turnover is realistic. Hence, the market rent after the termination of the current rental contract has been chosen in a range of 3%. Please also refer to the rent/turnover
analysis on page 8.
Conclusion
The subject property is a modern self-service department store with a small mall in the basement as well as some additional tenants on the ground floor. The tenant mix of the sublet areas is service oriented and
includes a hairdresser, pharmacy, newspaper kiosk, bakery, butcher’s shop, deli and drycleaner. The property offers sufficient parking spaces on two levels and is easily accessible as well as highly visible from both
Danziger Straße and Friedrichstraße. As Kaufland is a strong customer magnet, we believe that it will have no trouble letting the small retail units in the basement and on the ground floor. The retail units in the
annex, however, are difficult to let. This is partly due to the fact that in the location of the subject property, there is no demand for additional retail space. The current use as a restaurant/wine store are fine, however,
they do not benefit greatly from their location next to the Kaufland and therefore, it will be difficult to find new tenants if the current tenants do not prolong their lease terms. In contrast to this, the location has
established itself as a medical centre: several of the office units in both the main building and annex have been let to medical practices and a health centre complements this offer. The letting of the office units
assuming an adequate rental level can therefore be rated as relatively unproblematic.The rental area of Kaufland can be regarded as relatively unproblematic.
The location is suitable for the tenant and can be reached by foot from the surrounding residential area as well as by car. Even though the competition from the Kaufland located nearby is strong, the density of selfservice department stores is moderate for a city this size. We believe that the tenant will be able to compete, especially because it can operate on a very low contractual rent for a long time. The anchor tenant,
Kaufland, has a lease contract until 2022 with three options each for five years, bringing the earliest possible termination date for the landlord to 2037. On the basis of our projection of likely productivity per m² and
turnovers, we have calculated the market rent at a level of € 8.50/m²/month. The tenant currently pays a contractual rent of € 4.91/m²/p.m. Therefore, the retail unit is currently heavily underrented. Due to the
margins realizable and under the assumption of good turnover figures, we believe that Kaufland will remain in the property until 2037. In the unlikely case that Kaufland should vacate the premises, the property
could be relet to other self-service department stores, which are currently not present in the Ludwigsburg real estate market.
Page 5 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Kaufland Vertrieb ALPHA GmbH & Co. KG
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
100%
Tenant
pays *
Retail
Let
7,491
€ 36,743
4.91
No
01.10.2007
30.09.2027
2 SardoVino GmbH Alexander & Carolin Corongiu
Retail
Let
90
€ 1,001
11.13
Yes
14.09.2007
13.09.2017
75%
GT I PM
3 Corongiu
Retail
Let
260
€ 2,878
11.07
Yes
14.09.2007
13.09.2017
75%
GT I PM
4 Land BW vertr. Landesbetrieb Vermögen BW
Office
Let
165
€ 1,479
8.96
Yes
26.09.2007
30.10.2017
75%
GT I PM
5 Life GmbH
Office
Let
2,161
€ 10,041
4.65
Yes
16.05.2006
15.05.2016
75%
GT I
6 Life GmbH
Office
Let
595
€0
0.00
Yes
16.05.2006
15.05.2016
75%
GT I
7 Jacobi-Haumer
Office
240
€ 1,199
5.00
Yes
31.10.2007
30.10.2017
75%
GT I PM
8 Beyer
Office
Let
252
€ 2,728
10.82
Yes
01.04.2007
30.09.2014
75%
GT I PM
9 Praxisgem.
Office
Let
457
€ 4,296
9.40
Yes
01.04.2007
31.03.2017
75%
GT I PM
10 Schwarzenberger
Office
Let
177
€ 1,847
10.43
Yes
01.09.2010
31.08.2014
75%
GT I PM
Office
Let
205
€ 2,034
9.92
No
01.04.2007
31.03.2015
75%
GT I PM
Residential
Let
65
€ 470
7.23
Yes
01.07.2011
31.07.2014
75%
GT I
GT I
11 Praxisgemeinschaft
12 Thomas Corongiu
Let
13 Izmaku
Residential
Let
75
€ 575
7.67
Yes
01.12.2007
31.07.2014
75%
14 Monika Keinath
Residential
Let
65
€ 450
6.92
Yes
26.06.2006
31.07.2014
75%
GT I
15 Ekaterina und Alexander Erik
Residential
Let
65
€ 432
6.65
Yes
01.02.2003
31.07.2014
75%
GT I
16 Fam Wisag
Residential
Let
65
€0
0.00
Yes
01.02.2010
31.07.2014
75%
GT I
17 Meder
Residential
Let
63
€ 450
7.14
Yes
01.12.2006
31.07.2014
75%
GT I
18 Modnikov
Residential
Let
82
€ 500
6.10
Yes
26.11.2007
31.07.2014
75%
GT I
19 Jaqueline + Brian Skowais
Residential
Let
65
€ 450
6.92
Yes
01.04.2010
31.07.2014
75%
GT I
20 Izmaku
Residential
Let
65
€ 450
6.92
Yes
01.02.2007
31.07.2014
75%
GT I
21 Roth
Residential
Let
65
€ 432
6.65
Yes
01.09.1997
31.07.2014
75%
GT I
22 PROPERTY MANAGER
Residential
Let
87
€0
0.00
Yes
01.07.2011
30.06.2014
75%
GT I
23 Tahiri
Residential
Let
87
€ 602
6.92
Yes
01.02.2010
31.07.2014
75%
GT I
24 Jacobi-Haumer
Residential
Let
83
€ 600
7.23
Yes
01.08.2009
31.07.2014
75%
GT I
25 Pump Schmelzer
Residential
Let
85
€ 600
7.06
Yes
01.04.2010
31.07.2014
75%
GT I
26 Tarasov
Residential
Let
87
€ 616
7.08
Yes
01.02.2010
31.07.2014
75%
GT I
27 Török
Residential
Let
86
€ 602
7.00
Yes
01.02.2010
31.07.2014
75%
GT I
28 Schneider
Residential
Let
65
€ 408
6.28
Yes
01.02.2010
31.07.2014
75%
29 Deutsche Post Real Estate Germany GmbH
Other Units
Let
7
€ 125
17.86
Yes
27.07.2007
31.07.2014
75%
GT I
GT I PM
Internal Parking
Let
1
€0
0.00
Yes
01.07.2011
30.06.2014
75%
31 Jacobi-Haumer
Internal Parking
Let
1
€ 35
35.00
Yes
31.10.2007
30.10.2017
75%
32 Jacobi-Haumer
Internal Parking
Let
1
€ 35
35.00
Yes
31.10.2007
30.10.2017
75%
33 Tittes
Internal Parking
Let
1
€ 29
29.41
Yes
01.08.2009
31.07.2014
75%
34 Modnikov
Internal Parking
Let
1
€ 35
35.00
Yes
26.11.2007
31.07.2014
75%
35 Török
Internal Parking
Let
1
€ 29
29.41
Yes
01.02.2010
31.07.2014
75%
36 Roth, Doris
Internal Parking
Let
1
€0
0.00
Yes
01.04.2010
31.07.2014
75%
37 Pump schmelzer
Internal Parking
Let
1
€0
0.00
Yes
01.04.2010
31.07.2014
75%
38 Török
Internal Parking
Let
1
€ 29
29.41
Yes
01.05.2010
31.07.2014
75%
39 Tahiri
Internal Parking
Let
1
€0
0.00
Yes
01.09.2010
31.07.2014
75%
40 Modnikov
Internal Parking
Let
1
€ 35
35.00
Yes
01.05.2010
31.07.2014
75%
41 Izmaku
Internal Parking
Let
1
€ 35
35.00
Yes
01.12.2007
31.07.2014
42 Bondar
Internal Parking
Let
1
€ 35
35.00
75
01.08.2010
31.07.2014
75%
43 Gregor Warsow
Internal Parking
Let
1
€ 40
40.00
Yes
01.08.2010
31.07.2014
75%
44 Aro Heimtextilien GmbH
Retail
Let
460
€ 3,680
8.00
Yes
01.09.2011
31.08.2021
75%
GT I PM
45 Yamadi Yamadi Yoga Zentrum
Office
Let
262
€ 1,202
4.59
Yes
01.02.2013
31.01.2018
75%
GT I PM
46 Internal Parking
Internal Parking
Let
285
€ 6,667
23.39
No
00.01.1900
30.09.2022
100%
47 Gregor Warsow
Residential
Let
75
€ 540
7.20
Yes
01.01.2013
31.07.2014
75%
14,144 m²
€ 84,435
30 PROPERTY MANAGER
Total
75%
M GT I PM
GT I
Page 6 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Tenant Name
1 Kaufland Vertrieb ALPHA GmbH & Co. KG
Area Category
Area
sqm/unit
Market
Rent
Market
Rent /month
Retail
7,491
€ 8.50
€ 63,670
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
€ 50
0
12
0
3
10
0%
2 SardoVino GmbH Alexander & Carolin Corongiu
Retail
90
€ 9.00
€ 810
€ 100
0
12
0
3
10
25%
3 Corongiu
Retail
260
€ 8.50
€ 2,210
€ 100
0
9
0
3
10
25%
4 Land BW vertr. Landesbetrieb Vermögen BW
Office
165
€ 9.00
€ 1,485
€ 100
0
9
3
3
10
25%
5 Life GmbH
Office
2,161
€ 3.25
€ 7,023
€ 100
0
15
3
3
10
25%
6 Life GmbH
Office
595
€ 3.25
€ 1,934
€ 100
0
15
3
3
10
25%
7 Jacobi-Haumer
Office
240
€ 8.75
€ 2,097
€ 100
0
9
3
3
10
25%
8 Beyer
Office
252
€ 8.75
€ 2,205
€ 100
0
9
3
3
10
25%
9 Praxisgem.
Office
457
€ 8.50
€ 3,885
€ 100
0
12
3
3
10
25%
10 Schwarzenberger
Office
177
€ 9.00
€ 1,593
€ 100
0
9
3
3
10
25%
11 Praxisgemeinschaft
Office
205
€ 8.75
€ 1,794
€ 100
0
9
3
3
10
25%
12 Thomas Corongiu
Residential
65
€ 7.00
€ 455
€ 25
0
6
0
3
5
25%
13 Izmaku
Residential
75
€ 7.00
€ 525
€ 25
0
6
0
3
5
25%
14 Monika Keinath
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
15 Ekaterina und Alexander Erik
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
16 Fam Wisag
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
17 Meder
Residential
63
€ 6.75
€ 425
€ 25
0
6
0
3
5
25%
18 Modnikov
Residential
€ 7.00
€ 574
€ 25
0
6
19 Jaqueline + Brian Skowais
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
20 Izmaku
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
21 Roth
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
22 PROPERTY MANAGER
Residential
87
€ 7.00
€ 609
€ 25
0
6
0
3
5
25%
23 Tahiri
Residential
87
€ 7.00
€ 609
€ 25
0
6
0
3
5
25%
82
0
3
5
25%
24 Jacobi-Haumer
Residential
83
€ 7.00
€ 581
€ 25
0
6
0
3
5
25%
25 Pump Schmelzer
Residential
85
€ 7.00
€ 595
€ 25
0
6
0
3
5
25%
26 Tarasov
Residential
87
€ 7.00
€ 609
€ 25
0
6
0
3
5
25%
27 Török
Residential
86
€ 7.00
€ 602
€ 25
0
6
0
3
5
25%
28 Schneider
Residential
65
€ 6.75
€ 439
€ 25
0
6
0
3
5
25%
29 Deutsche Post Real Estate Germany GmbH
Other Units
7
€ 17.86
€ 125
€0
0
0
0
3
10
25%
12
0
0
31 Jacobi-Haumer
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
32 Jacobi-Haumer
30 PROPERTY MANAGER
Internal Parking
Internal Parking
1
1
€ 32.50
€ 32.50
€ 33
€ 33
€0
€0
0
0
12
0
0
5
5
25%
25%
33 Tittes
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
34 Modnikov
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
35 Török
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
36 Roth, Doris
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
37 Pump schmelzer
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
38 Török
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
39 Tahiri
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
40 Modnikov
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
41 Izmaku
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
42 Bondar
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
43 Gregor Warsow
Internal Parking
1
€ 32.50
€ 33
€0
0
12
0
0
5
25%
Retail
460
€ 7.00
€ 3,220
€ 100
0
12
0
3
10
25%
25%
44 Aro Heimtextilien GmbH
45 Yamadi Yamadi Yoga Zentrum
25%
Office
262
€ 8.75
€ 2,293
€ 100
0
9
0
3
10
46 Internal Parking
Internal Parking
285
€ 24.85
€ 7,082
€0
0
0
0
0
0
0%
47 Gregor Warsow
Residential
75
€ 6.75
€ 506
€ 25
0
6
0
3
5
25%
Total
* months
14,144 sqm
** years
€ 111,042
Page 7 of 12
.
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
4,514
8,301
0
0
0
1,330
0
14,144
0
7
299
0
306
Area Vacant
m²
0
0
0
0
0
0
0
0
0
0
0
0
0
Area Let
m²
4,514
8,301
0
0
0
1,330
0
14,144
0
7
299
0
299
Vacancy Rate
%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
5.50
5.34
0.00
0.00
0.00
6.15
0.00
0.00
17.86
5.47
23.43
0.00
Contractual
Rent
€/month
24,824
44,303
0
0
0
8,178
0
0
125
77,430
7,006
0
Contractual
Rent
€/year
297,892
531,636
0
0
0
98,130
0
0
1,500
929,158
84,066
0
Potential
Rent
€/year
297,892
531,636
0
0
0
98,130
0
0
1,500
929,158
84,066
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
5.39
8.42
0.00
0.00
0.00
6.89
0.00
0.00
17.86
7.32
25.21
0.00
Market
Rent
€/year
291,696
838,921
0
0
0
109,941
0
0
1,500
1,242,058
90,447
0
Market
Rent
€/month
24,308
69,910
0
0
0
9,162
0
0
125
103,505
7,537
0
Over-/ UnderRented
2.1%
-36.6%
0.0%
0.0%
0.0%
-10.7%
0.0%
0.0%
0.0%
-25.2%
-7.1%
0.0%
Space productivity
7,000
11.00
6,500
10.00
Explanation
10.33
Market rent
9.00
6,000
Contractual Rent
8.50
8.00
Rent / m² / month
5,500
5,000
4,500
Rents
7.75
7.00
6.00
5.17
4.91
5.00
€ / m²
%
Contractual
1.9%
4.91
Market
3.3%
8.50
4% of turnover
10.33
3% of turnover
7.75
4,000
5.17
2% of turnover
4.00
4,132
3,500
Turnover potential
3.00
(net)
Sales Area
3,000
2.00
1.0%
in € / m² p.a.
23,216,057 €
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 5,618 m²
7,491 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Vertrieb ALPHA GmbH & Co. KG
€ 440,916
44%
13.7 years
80
3AA 1
1
86
n.a.
Schwarz Group, one of the biggest grocer groups in Europe. According to Dun & Bradstreet (D&B)
Rating as at 29.01.2014 Kaufland Vertrieb ALPHA GmbH & Co. KG has a very low credit risk. The risk
of insolvency (D&B Score) within the next 12 months compared with other German companies is
assessed to be low. According to section 19 of the main lease agreement entered into by the landlord
and Kaufland Dienstleistung GmbH & Co. KG (D&B Rating = 3 AA 1), an assignment of the main lease
agreement by the tenant to another entity of the Kaufland group requires that the landlord's credit risk
rating may not deteriorate due to such assignment of the lease.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
9
Market Value
The property is fully let to four retail tenants, one health centre, 5 office tenants and several residential tenants. The WALT of the property amounts to 7.9 years. The main tenant is Kaufland with a share of approx.
44% of the rental income. The property is currently strongly under-rented, due to a very low rental level of the main tenant Kaufland. As the lease contract is valid until 2027 and the tenant has options until 2037, we
do not believe that the rental level can be adjusted before 2037. The rent of Kaufland is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI
basis. Indexation started on 01.04.2009. The majority of the tenants pay all costs (including ground tax, insurance costs and management costs) except for maintenance costs for structural repairs. The residential
tenants and the tenant Life GmbH (health centre) do not pay management costs. Ground tax, maintenance costs for structural repairs, management and insurance costs will not be borne by Kaufland. The rest can
be apportioned to the tenants in accordance with the German Regulation on Operating Costs.
Compared to the previous valuation, some residential units have been newly let. Furthermore, some leases have been subject to an indexation adjustment.
Discount rate
6.50%
Capitalisation rate
6.25%
account such facts as the remaining lease term with the well-known anchor tenant, the reduction of
vacancy and consequently low vacancy rate, the good turnover figures, the good location within the
federal state Baden-Wuerttemberg and the good condition of the subject property.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 4.75 /m²
€ 1.07 /m²
€ 3.26 /m²
€ 0.37 /m²
€ 0.00 /m²
€ 9.46 /m²
€ 67,185
€ 15,198
€ 46,179
€ 5,276
€0
€ 133,838
per year
per year
€ 4.75 /m²
€ 1.41 /m²
€ 3.26 /m²
€ 0.37 /m²
€ 0.00 /m²
€ 9.80 /m²
€ 67,185
€ 19,988
€ 46,179
€ 5,276
€0
€ 138,628
Inflation
% of Gross
Contract Rent
6.63%
1.50%
4.56%
0.52%
0.00%
13.21%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.04%
1.50%
3.47%
0.40%
0.00%
10.40%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 67,218
€ 68,294
€ 69,510
€ 70,733
€ 71,879
€ 73,015
€ 74,183
€ 75,385
€ 76,576
€ 77,709
€ 78,843
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 14,892
€ 15,141
€ 14,444
€ 14,764
€ 15,289
€ 15,579
€ 15,929
€ 16,062
€ 16,342
€ 16,463
€ 16,394
Insurance
Costs
€ 5,276
€ 5,360
€ 5,456
€ 5,552
€ 5,642
€ 5,731
€ 5,822
€ 5,917
€ 6,010
€ 6,099
€ 6,188
Ground
Tax
€ 46,179
€ 46,918
€ 47,753
€ 48,593
€ 49,381
€ 50,161
€ 50,963
€ 51,789
€ 52,607
€ 53,386
€ 54,165
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 135,247
€ 136,060
€ 146,663
€ 142,247
€ 142,658
€ 146,309
€ 146,897
€ 150,442
€ 151,535
€ 153,657
€ 158,111
Vacancy
Costs
€ 1,682
€ 347
€ 9,500
€ 2,605
€ 467
€ 1,823
€0
€ 1,289
€0
€0
€ 2,521
% of Total
Gross Revenue
13.6%
13.5%
15.2%
14.5%
14.0%
14.1%
13.8%
14.0%
13.9%
14.0%
14.5%
16.0%
15.2%
14.5%
14.0%
13.6%
13.5%
14.0%
14.1%
13.8%
14.0%
13.9%
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,015,267
€ 1,024,645
€ 1,028,511
€ 1,024,068
€ 1,043,100
€ 1,054,898
€ 1,062,303
€ 1,081,769
€ 1,089,465
€ 1,097,782
€ 1,115,805
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 16,976
-€ 3,664
-€ 37,400
-€ 27,417
-€ 4,983
-€ 16,322
-€ 360
-€ 10,962
€0
-€ 226
-€ 22,875
Rent
Abatements
-€ 5,465
-€ 11,597
-€ 28,153
-€ 12,362
-€ 18,875
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 992,826
€ 1,009,384
€ 962,958
€ 984,289
€ 1,019,242
€ 1,038,576
€ 1,061,943
€ 1,070,807
€ 1,089,465
€ 1,097,556
€ 1,092,930
Nonrecoverable
Costs
-€ 135,247
-€ 136,060
-€ 146,663
-€ 142,247
-€ 142,658
-€ 146,309
-€ 146,897
-€ 150,442
-€ 151,535
-€ 153,657
-€ 158,111
Net
Operating
Income
€ 857,579
€ 873,324
€ 816,295
€ 842,042
€ 876,584
€ 892,267
€ 915,046
€ 920,365
€ 937,930
€ 943,899
€ 934,819
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 14,351
-€ 7,462
€ 835,766
-€ 5,207
-€ 1,721
€ 866,396
-€ 71,248
-€ 8,798
€ 736,249
€ 796,585
-€ 39,381
-€ 6,076
-€ 27,447
€ 842,426
-€ 6,711
-€ 6,561
-€ 6,259
€ 879,447
-€ 616
€ 913,844
-€ 586
€ 865,343
-€ 51,588
-€ 3,434
€0
€0
€ 937,930
€0
€0
€ 943,899
€ 15,289,904
-€ 5,284
-€ 5,025
Present
Value @
6.50%
€ 813,007
€ 790,174
€ 632,839
€ 641,820
€ 635,314
€ 623,789
€ 608,522
€ 542,126
€ 550,673
€ 520,352
€ 8,145,330
€ 14,503,946
€0
€ 14,503,946
7.0%
€ 1200000.0
5.9%
5.6%
€ 1000000.0
6.2%
6.0%
6.0%
6.3%
6.3%
6.5%
5.8%
6.5%
6.0%
5.0%
4.0%
€ 600000.0
3.0%
Running yield
Rental income
€ 800000.0
€ 400000.0
2.0%
€ 200000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,013,225
€ 5.97
Market rental value
total p.a.
per m²/month
€ 1,332,505
€ 7.85
-23.96%
Over-/Underrent
Year 8
Total
€ 14,500,000
per m²
€ 1,025
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
6.06%
8.23%
Gross Initial Yield
7.45%
9.80%
Total
€ 13,600,000
per m²
€ 962
Valuation Comment
In terms of risk, we have considered the covenant strength as well as the lease duration for the existing contracts. The main tenant, Kaufland Vertrieb ALPHA GmbH & Co. KG has good covenant strength, which
ensures a secure cash flow for the remainder of the lease term until at least 2027. Section 1 of the first amendment to the main lease agreement provides for the assignment of the main lease agreement to ALPHA
Warenhandel GmbH & Co. KG, which has a worse D&B Rating (O 1). Pursuant to section 2 of the first amendment to the main lease agreement, the former tenant remains jointly and severally liable for the
landlord's payment claims. Hence, the former tenant is a guarantor for the lease payments of the current tenant. In terms of a resale, we considered such facts as visibility, appearance, condition, third-party usability
and location.
For the purpose of the valuation on 31.12.2013, we have been provided with an updated rent roll and applied it in our valuation. The contractual rental income slightly decreased, other costs have remained
unchanged and have been applied according to information received during the previous valuation cycle. For management costs, we have applied 1.5% of the effective gross rent. We have not been provided with
updated information regarding necessary capital expenditures, therefore we applied that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to
be covered by the the maintenance costs of € 4.50/m² per annum. The encumbrances and the public easements are considered to be common practice and do not affect the Market Value of the property. For
comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions.
0
Page 10 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Photos
Southern facade of Kaufland
View of the annex building from Danziger Straße
Internal view of the sales areas of the tenant Kaufland
View of the mall
View of the vacant retail unit in the annex building
View of the parking garage
Page 11 of 12
abc
Property address
Property no.
9
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
71638 Ludwigsburg
Inspection date:
03.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Marktkauf
Kaufland
Kaufland
Marktkauf
Kaufland
Residential
Office
Office
City
Ulm
Lüneburg
Freital
Lauchhammer
Bochum
Ludwigsburg
Ludwigsburg
Ludwigsburg
Property Type
Appartment
Office
Office
Area
6,233 m²
4,611 m²
7,940 m²
9,506 m²
6,388 m²
85 m²
333 m²
452 m²
Total Rent p.m.
€ 56,032
€ 35,732
€ 61,538
€ 74,052
€ 56,214
€ 655
€ 2,832
€ 3,842
Rent p. sqm
€ 8.99 /m²
€ 7.75 /m²
€ 7.75 /m²
€ 7.79 /m²
€ 8.80 /m²
€ 7.70 /m²
€ 8.50 /m²
€ 8.50 /m²
Comment
Comparable purchasing power, better location
Lower purchasing power; worse location
Smaller retail area, slightly lower purchasing power
Offer
Offer
Offer
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
10
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Warenhandel Brandenburg GmbH & Co. KG
Total lettable area
Total parking units
12,632 m²
0 units
0.0%
7.6 years
1997
n.a.
total p.a.
per m² / month
€ 1,208,820
€ 7.97
total p.a.
per m² / month
€ 110,417
€ 0.73
total p.a.
per m² / month
€ 1,098,403
€ 7.25
total p.a.
€ 1,085,152
11.4%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Located in city centre location
Located close to other retailers on an arterial road
Well maintained
Good tenant mix
Sufficient parking spaces but located underground
Sales area spread over several floors
0
0
0
Opportunities
Threats
Extension of the lease contracts of smaller tenants
0
0
0
0
Strong dependency on the main tenant Kaufland
Difficult relettability of the fitness studio
Potential new developments will increase competition
0
Building
Location
Building age
Lettable Area
Property condition
General impression
2
4
3
3
16 to 25 years
Between 12,500 and 15,000 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
4
4
4
Good micro location
Low competition level
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The subject property is a three storey department store complex, furnished with escalators. The property was built in 1997 and is situated at Potsdamer Straße, Karl-Liebknecht-Straße and Bruno-Taut-Straße. The
property has one main entrance from Potsdamer Straße and can also be accessed from the underground parking garage. The buildings have an irregular shape and are made of a steel reinforced concrete
construction. The facade consists in parts of plastered or with facing bricks and in the entrance area of glass. It has a flat roof with hard covering.
Valuation Results
Market Value
€ 14,700,000
equals to
Market Rental Value
€ 1,164 per m²
€ 1,085,152 p.a.
Discount Rate
7.10%
Net Initial Yield
7.00%
Capitalisation Rate
7.00%
6.22%
excluding
capital
expenditures
Page 1 of 12
€ 7.16 / m² / p.m.
equals to
7.00%
12.16
6.22%
13.55
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Location
Germany
Brandenburg
Teltow-Fläming (Rural District)
Ludwigsfelde
14974
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Ludwigsfelde
2,495,635
161,546
24,150
11,310
77
221
3.3%
-2.2%
0.2%
9.6%
7.4%
District
City
Federal State
District
District
in m €
in m €
index
index
index
3,019
459
88.50
92.27
80.33
Macro Location
Ludwigsfelde is situated in the federal state of Brandenburg in the administrative region of TeltowFläming. The city covers an area of 109.3 sq km. Nearby cities include Berlin (30 km) and Potsdam (20
km). The A10 federal motorway is located directly next to Ludwigsfelde, offering a direct connection to
the motorway network. Thus, Ludwigsfelde is an interesting logistics location. The city’s railway station is
linked to the regional railway network, offering connections to Berlin and Potsdam.
The closest passenger airport is located in Berlin, which can be reached within 30 km.
The economy of Ludwigsfelde is primarily focussed on logistics and production facilities. Ludwigsfelde
has an industrial park with an area of over 256 ha, where more than 70 companies operate. Additionally,
there are three commercial parks with over 618 ha, where more than 900 companies are located. The
district Teltow-Fläming is economically one of the strongest districts in the former East German states.
Micro Location
Micro Location
The property is located at the residential and office street, Potsdamer Straße, close to the A10 motorway
and the city centre in the western part of the city. The town hall is located only 500 m from the property.
The property is highly visible and dominates the area to some extent. The property is surrounded by
residential buildings, but there are also retail warehouses, for example operated by Rossmann, directly
next to Potsdamer Straße. Thanks to the underground garage, many visitors of the local market located
in front of the town hall, use the property for parking purposes, increasing the footfall of the property.
However, the market takes place only twice a week.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
380
5.0
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Site Plan
Source: Cadastral plan on a 1 to 1,500 scale, dated 27th December 2010
Site Information
Site area
10,340 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
Comment
The property has an even topography and irregular shape. It is accessible from the north-east, southeast and north-west. According to information provided by the city of Ludwigsfelde, the site is not
registered in the register of contaminated sites.
In Brandenburg, there are no building encumbrances. Instead the muncipalities obtain personal
easments, which are registered in the land register in divison 2. Thus, we assumed the subject property
to be free of any building encumbrances.
No
Town Planning
Use class
SO (special zone)
1.0
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
n.a.
Comment
entitled "Nr. 2 Sport- und Einkaufszentrum Ludwigsfelde" and dated 10.10.1994, with the following
regulations: the subject site is located in a special zone (SO). The site coverage ratio is limited to 1.0.
Tenure
Land Register
Local Court of Zossen,
land register of
Ludwigsfelde
Owner
TPL Ludwigsfelde
S.á.r.l., Luxemburg
Sheet
4807
Plot
3 a/b
Parcel
150, 152
159, 161
15/130, 15/132
15/133, 41
154, 155
157
Section 3 (Loans)
Limited personal easement in favour of the city of Land charges in the total amount of € 105,000,000 in
Ludwigsfelde prohibiting that certain parts of the favour of COREAL CREDIT BANK Aktiengesellschaft
property may be built on.
Frankfurt, 6 June 2011.
Limited personal easement right of way in favour
the owner of the plot 15/132.
Limited personal easement to operate a selfservice department store on the plot in favour of
Kaufland Stiftung & Co. KG, Neckarsulm.
Page 3 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Type
Address
0
0
0
0
Sales area
m²
m²
m²
0
Distance
Potential
0
0
0
0
0
0
0
0
0
0
0
0
14,472
43,244
6,748
19,622
92.27
3,019
19,429
7.4%
3.3%
80.33
Page 4 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
10
Main competitors
There is no direct competitor within Ludwigsfelde or the primary or secondary catchment area. The
neighbouring property next door has a bank and a retail use on the ground floor, but is not
considered to be real competition. However, the property is considering incorporating the same
product range as the subject property.
The property, which can be considered a largest competitor within Ludwigsfelde, is shown above. It
comprises six retail units including a Penny discounter and a large drugstore operated by Rossmann.
The overall size is however significantly smaller than the subject property.
Competition Comment
Approximately 15,000 inhabitants live in the secondary catchment area. This area is dominated by the subject property as there is no other self-service department store. Within the broader tertiary catchment area,
there are 59,000 inhabitants and still only one competitor, which increases the customer potential to 24,500 potential customers per self-service department store.
However, we think that the property will mainly attract customers from the primary and secondary catchment area, but this is sufficient for this property. Thus, there are no direct competitors. Only small
supermarkets or discounters compete for the non-food customers. Consequently, we assess the level of competition to be below average and that the customer potential is sufficient.
0
Turnover analysis
The rents in retail agglomerations are linked to the achievable turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market sectors. This
rate normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² up to more than € 10,000/m². We have been provided with turnover figures
from tenants such as s.m.s. (shopping macht Spaß GmbH), Deichmann, Floristik´99, among others. For Kaufland, we have also been provided with turnover figures. We have analysed the figures and have found
the area productivity of Kaufland to be in a healthy range. With a turnover-to-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store. Hence, we are of
the opinion that a market rent on contractual level is achievable after the end of the lease contract. Please also refer to the rent/turnover analysis on page 8.
With regards to turnover rents, we considered the current turnover rents to be sustainable in the long run for the property’s income.
Conclusion
The subject property is a self-service department store situated in a city centre location of Ludwigsfelde. The depth and breadth of the product range is very good. The property dominates the primary and secondary
catchment areas, which should be sufficient for operating a self-service department store. Thus, the rental area of Kaufland can be regarded as relatively unproblematic. In the unlikely case that Kaufland should
vacate the site, the property could be re-let to other self-service department store chains such as real or Marktkauf. We assumed that the tenant Kaufland will exercise its three options, each for five years, until 2037
due to the low contractual rental level. We therefore think that this location should be sustainable.
0
Page 5 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
Area Category
Letting
Status
Area
m² / unit
64
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
€ 1,950
30.57
n.a.
01.10.2007
30.09.2017
75%
M GT I PM
2 Deutsche Bank
Retail
Let
196
€ 3,082
15.72
n.a.
30.08.2012
30.06.2017
75%
M GT I PM
3 Kaufland Warenhandel
Retail
Let
5,940
€ 32,586
5.49
n.a.
01.10.2007
30.09.2027
75%
M GT I PM
4 Zebra two GmbH i.Gr.
Retail
Let
51
€ 992
19.45
n.a.
01.10.2013
30.09.2023
75%
M GT I PM
5 iFitness GmbH i. G.r
Retail
Let
995
€ 5,624
5.65
n.a.
01.07.2013
30.09.2023
75%
M GT I PM
6 Heiderich, Karsten Manfred
Retail
Let
51
€ 635
12.50
n.a.
15.04.2013
14.04.2023
75%
M GT I PM
7 Ms. + Mr. Cetinkaya & Mr. Özyurt
Retail
Let
36
22.91
n.a.
01.04.2012
31.03.2022
75%
M GT I PM
8 HAARMEX.DE
Retail
Let
125
€ 1,181
9.45
n.a.
10.01.2005
09.01.2020
75%
M GT I PM
9 Johae Fleischprodukte GmbH & Co. KG
Retail
Let
67
€ 2,687
39.89
n.a.
01.08.2008
31.07.2019
75%
M GT I PM
10 Deichmann SE
Retail
Let
407
€ 4,412
10.83
n.a.
14.06.2004
13.06.2019
75%
M GT I PM
11 Deichmann SE
M GT I PM
€ 825
Storage
Let
39
€ 137
3.50
n.a.
14.06.2004
13.06.2019
75%
12 Apollo-Optik Holding GmbH & Co. KG
Retail
Let
117
€ 2,617
22.40
n.a.
01.06.2004
31.05.2019
75%
M GT I PM
13 Ulus Filiz und Melki
Retail
Let
44
€ 1,135
25.54
n.a.
01.10.2013
30.09.2018
75%
M GT I PM
14 Zebra Gastronomie und Automaten GmbH
Retail
Let
167
€ 1,539
9.21
n.a.
01.09.2003
14.10.2017
75%
M GT I PM
15 Wohnungsgesellschaft Ludwigsfelde mbH
Office
Let
131
€ 551
4.22
n.a.
13.10.1997
12.10.2017
75%
M GT I PM
Retail
Let
536
€ 4,393
8.20
n.a.
01.10.1997
30.09.2017
75%
M GT I PM
17 s.m.s. shopping macht Spaß GmbH
Retail
Let
131
€ 1,414
10.76
n.a.
01.10.2007
30.09.2017
75%
M GT I PM
18 Floristik´99
Retail
Let
63
€ 1,510
24.11
n.a.
01.10.2007
30.09.2017
75%
M GT I PM
Other Units
Let
1
€ 596
595.83
n.a.
01.01.2010
30.09.2017
100%
Other Units
Let
1
€0
0.00
n.a.
01.01.2011
30.09.2017
100%
M GT I PM
21 Anh Nguyet Tran
Retail
Let
55
€ 651
11.76
n.a.
14.09.2012
30.09.2017
75%
M GT I PM
22 Stadt Ludwigsfelde
Retail
Let
2,031
€ 3,731
1.84
n.a.
22.09.1997
21.09.2017
100%
M GT I PM
23 Wendorff
Retail
Let
173
€ 5,434
31.37
n.a.
08.09.1997
07.09.2017
75%
M GT I PM
24 Steinecke´s Heidebrot Backstube GmbH & Co. KG
Retail
Let
72
€ 5,652
78.10
n.a.
01.10.2007
30.06.2017
75%
M GT I PM
25 Döbelin
Retail
Let
78
€ 1,499
19.21
n.a.
01.04.2012
30.11.2016
75%
M GT I PM
26 Valaora Retail Kiosk GmbH
Retail
Let
45
€ 1,293
28.69
n.a.
10.10.2006
09.10.2016
75%
M GT I PM
27 Vodafone D2 GmbH
Retail
Let
52
€ 1,402
27.14
n.a.
02.04.2009
31.12.2015
75%
M GT I PM
28 Naser
Retail
Let
65
€ 1,069
16.55
n.a.
13.10.2007
12.10.2015
75%
M GT I PM
29 TEDI GmbH & Co. KG
Retail
Let
266
€ 2,452
9.22
n.a.
21.04.2004
20.04.2015
75%
M GT I PM
M GT I PM
Retail
Let
533
€ 4,796
9.00
n.a.
01.10.1997
31.12.2014
75%
M GT I PM
31 Kaufmann
Retail
Let
102
€ 1,374
13.49
n.a.
19.10.2005
18.10.2014
75%
M GT I PM
Other Units
Let
2
€ 56
34.10
n.a.
01.01.2007
31.12.2013
100%
M GT I PM
33 KZM (kiosk)
Other Units
Let
1
€ 370
370.00
n.a.
01.10.2007
30.09.2027
100%
M GT I PM
34 Mall Income (automats)
Other Units
Let
1
€0
0.00
n.a.
01.10.2007
30.09.2027
100%
M GT I PM
35 Turnover Rent
Other Units
Let
1
€ 3,089
3089.00
01.10.2007
30.09.2027
100%
M GT I PM
12,632 m²
€ 100,735
Total
Page 6 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Area Category
Tenant Name
Retail
Area
sqm/unit
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
64
€ 25.00
€ 1,595
€ 100
0
12
0
3
5
25%
2 Deutsche Bank
Retail
196
€ 10.00
€ 1,960
€ 100
0
12
0
3
5
25%
3 Kaufland Warenhandel
Retail
5,940
€ 5.50
€ 32,669
€ 50
0
12
0
3
10
25%
4 Zebra two GmbH i.Gr.
Retail
51
€ 15.00
€ 765
€ 100
0
12
0
3
5
25%
5 iFitness GmbH i. G.r
Retail
995
€ 3.50
€ 3,483
€ 75
0
18
0
3
5
25%
6 Heiderich, Karsten Manfred
Retail
51
€ 10.00
€ 508
€ 100
0
12
0
3
5
25%
7 Ms. + Mr. Cetinkaya & Mr. Özyurt
Retail
36
€ 20.00
€ 720
€ 100
0
12
0
3
5
8 HAARMEX.DE
Retail
125
€ 9.00
€ 1,125
€ 100
0
12
0
3
5
25%
9 Johae Fleischprodukte GmbH & Co. KG
Retail
67
€ 37.50
€ 2,526
€ 100
0
3
0
3
5
25%
10 Deichmann SE
Retail
407
€ 10.00
€ 4,073
€ 100
0
12
0
3
5
25%
11 Deichmann SE
Storage
39
€ 3.50
€ 137
€0
0
12
0
3
5
25%
Retail
117
€ 27.50
€ 3,213
€ 100
0
6
0
3
5
25%
5
25%
12 Apollo-Optik Holding GmbH & Co. KG
13 Ulus Filiz und Melki
Retail
44
€ 25.00
€ 1,111
€ 100
0
14 Zebra Gastronomie und Automaten GmbH
Retail
167
€ 8.00
€ 1,337
€ 100
0
12
0
3
5
25%
15 Wohnungsgesellschaft Ludwigsfelde mbH
Office
131
€ 5.00
€ 653
€ 100
0
12
0
3
5
25%
Retail
536
€ 8.00
€ 4,284
€ 100
0
12
0
3
5
25%
17 s.m.s. shopping macht Spaß GmbH
Retail
131
€ 10.00
€ 1,314
€ 100
0
12
0
3
5
25%
Retail
€ 100
5
25%
3
63
€ 27.50
€ 1,723
Other Units
1
€ 595.83
€ 596
€0
0
0
0
0
5
Other Units
1
€ 0.00
€0
€0
0
0
0
0
5
0%
21 Anh Nguyet Tran
Retail
55
€ 9.00
€ 498
€ 100
0
12
0
3
5
25%
22 Stadt Ludwigsfelde
Retail
2,031
€ 1.84
€ 3,731
€0
0
0
0
3
5
0%
23 Wendorff
Retail
173
€ 30.00
€ 5,197
€ 100
0
12
0
3
5
25%
24 Steinecke´s Heidebrot Backstube GmbH & Co. KG
Retail
72
€ 60.00
€ 4,342
€ 100
6
0
18 Floristik´99
0
6
25%
0
0
3
3
5
0%
0
3
25 Döbelin
Retail
78
€ 15.00
€ 1,170
€ 100
0
12
0
3
5
25%
26 Valaora Retail Kiosk GmbH
Retail
45
€ 25.00
€ 1,127
€ 100
0
6
0
3
5
25%
25%
25%
27 Vodafone D2 GmbH
Retail
52
€ 25.00
€ 1,291
€ 100
0
6
0
3
5
28 Naser
Retail
65
€ 10.00
€ 646
€ 100
0
12
0
3
5
25%
Retail
266
€ 9.00
€ 2,395
€ 100
0
12
0
3
5
25%
Retail
533
€ 9.00
€ 4,796
€ 100
0
12
5
25%
Retail
102
€ 10.00
€ 1,019
€ 100
0
12
0
3
5
25%
Other Units
2
€ 34.10
€ 56
€0
0
0
0
0
0
0%
33 KZM (kiosk)
Other Units
1
€ 370.00
€ 370
€0
0
0
0
0
0
0%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
0
0%
35 Turnover Rent
Other Units
1
€ 0.00
€0
€0
0
0
0
0
0
0%
31 Kaufmann
Total
* months
12,632 sqm
** years
0
3
€ 90,429
Page 7 of 12
.
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
131
12,462
0
0
0
0
39
12,632
0
7
0
0
7
Area Vacant
m²
0
0
0
0
0
0
0
0
0
0
0
0
0
Area Let
m²
131
12,462
0
0
0
0
39
12,632
0
7
0
0
0
Vacancy Rate
%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
4.22
7.70
0.00
0.00
0.00
0.00
3.50
0.00
618.21
7.97
0.00
0.00
Contractual
Rent
€/month
551
95,936
0
0
0
0
137
0
4,111
100,735
0
0
Contractual
Rent
€/year
6,614
1,151,231
0
0
0
0
1,642
0
49,333
1,208,820
0
0
Potential
Rent
€/year
6,614
1,151,231
0
0
0
0
1,642
0
49,333
1,208,820
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
5.00
7.11
0.00
0.00
0.00
0.00
3.50
0.00
153.70
7.16
0.00
0.00
Market
Rent
€/year
7,840
1,063,405
0
0
0
0
1,642
0
12,265
1,085,152
0
0
Market
Rent
€/month
653
88,617
0
0
0
0
137
0
1,022
90,429
0
0
Over-/ UnderRented
-15.6%
8.3%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
302.2%
11.4%
0.0%
0.0%
Space productivity
7,000
10.00
6,500
9.00
Explanation
8.00
5,500
7.00
Rent / m² / month
6,000
5,000
4,500
8.87
Market rent
Contractual Rent
Rents
6.65
6.00
5.00
4.00
3,500
2.5%
5.49
Market
2.5%
5.50
5.50
5.49
4.43
4,000
4% of turnover
8.87
3% of turnover
6.65
3.00
in € / m² p.a.
15,796,730 €
(net)
Sales Area
2.00
1.0%
4.43
2% of turnover
Turnover potential
3,761
3,000
€ / m²
%
Contractual
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 4,200 m²
5,940 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
€ 391,032
32%
13.7 years
80
3AA 2
2
83
€ 66,000 (single) € 840,000 (total)
The main tenant is a corporation belonging to SBG Kaufland GmbH & Co. KG, which in turn belongs to
Schwarz Beteiligungs-KG, one of the biggest grocer groups in Europe. Kaufland is the self-service
department store division of Lidl & Schwarz with more than 500 locations across Europe. Kaufland’s
core business area is food retailing with branded goods and own-brands specially produced for
Kaufland. According to Dun & Bradstreet (D&B) Rating as at 29 January 2014 Kaufland Warenhandel
Brandenburg GmbH & Co. KG has a low credit risk. The risk of insolvency (D&B Score) within the next
12 months compared with other German companies is assessed to be low, i.e. 83% of businesses on
the German database have the same or higher risk of failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
10
Market Value
The property is fully let to 27 retail tenants with Kaufland as the anchor tenant. The WALT of the property amounts to 7.6 years. The main tenant Kaufland has a share of approx. 34% of the rental income. The rent
of Kaufland is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI basis. Kaufland does not pay ground tax, insurance costs, maintenance or
property management. Smaller tenants usually cover these costs with the exception of maintenance costs. Some smaller tenants also do not pay property management but these are the minority. The following
tenant's has just extended the lease contract: Haarmex.de until 01/2020, Johae Fleischprodukte GmbH until 7/2019. Furthermore, there are three new tenants: iFitness GmbH, Zebra two GmbH and Heiderich,
Karten and Manfred.
0
Discount rate
7.10%
Capitalisation rate
7.00%
account such facts as the remaining lease term with the well-known anchor tenant, the good location,
the low vacancy rate and the good condition of the subject property in Ludwigsfelde.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.44 /m²
€ 1.40 /m²
€ 0.40 /m²
€ 0.00 /m²
€ 8.74 /m²
€ 69,476
€ 18,132
€ 17,743
€ 5,066
€0
€ 110,417
per year
per year
€ 5.50 /m²
€ 1.29 /m²
€ 1.40 /m²
€ 0.40 /m²
€ 0.00 /m²
€ 8.59 /m²
€ 69,476
€ 16,277
€ 17,743
€ 5,066
€0
€ 108,562
Inflation
% of Gross
Contract Rent
5.75%
1.50%
1.47%
0.42%
0.00%
9.13%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
6.40%
1.50%
1.64%
0.47%
0.00%
10.00%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 69,478
€ 70,590
€ 71,847
€ 73,111
€ 74,296
€ 75,469
€ 76,677
€ 77,919
€ 79,150
€ 80,322
€ 81,494
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 18,156
€ 17,708
€ 18,019
€ 16,981
€ 17,702
€ 17,665
€ 18,222
€ 18,677
€ 18,477
€ 17,953
€ 18,260
Insurance
Costs
€ 5,066
€ 5,147
€ 5,239
€ 5,331
€ 5,417
€ 5,503
€ 5,591
€ 5,682
€ 5,771
€ 5,857
€ 5,942
Ground
Tax
€ 17,743
€ 18,027
€ 18,348
€ 18,671
€ 18,973
€ 19,273
€ 19,581
€ 19,899
€ 20,213
€ 20,512
€ 20,812
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 110,626
€ 113,710
€ 113,755
€ 117,978
€ 116,746
€ 119,408
€ 122,916
€ 122,469
€ 124,719
€ 131,565
€ 130,114
Vacancy
Costs
€ 183
€ 2,238
€ 302
€ 3,884
€ 358
€ 1,498
€ 2,845
€ 292
€ 1,108
€ 6,921
€ 3,606
% of Total
Gross Revenue
9.1%
9.6%
9.5%
10.4%
9.9%
10.1%
10.1%
9.8%
10.1%
11.0%
10.7%
12.0%
11.0%
10.4%
10.0%
9.6%
9.1%
9.5%
9.9%
10.1%
10.1%
9.8%
10.1%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,212,440
€ 1,204,812
€ 1,208,159
€ 1,193,786
€ 1,184,647
€ 1,201,114
€ 1,245,709
€ 1,250,220
€ 1,254,360
€ 1,268,233
€ 1,252,102
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 2,038
-€ 24,266
-€ 6,872
-€ 61,706
-€ 4,505
-€ 23,443
-€ 30,906
-€ 5,069
-€ 22,586
-€ 71,373
-€ 34,787
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,210,402
€ 1,180,546
€ 1,201,287
€ 1,132,080
€ 1,180,142
€ 1,177,671
€ 1,214,803
€ 1,245,151
€ 1,231,774
€ 1,196,860
€ 1,217,315
Nonrecoverable
Costs
-€ 110,626
-€ 113,710
-€ 113,755
-€ 117,978
-€ 116,746
-€ 119,408
-€ 122,916
-€ 122,469
-€ 124,719
-€ 131,565
-€ 130,114
Net
Operating
Income
€ 1,099,776
€ 1,066,836
€ 1,087,532
€ 1,014,102
€ 1,063,396
€ 1,058,263
€ 1,091,887
€ 1,122,682
€ 1,107,055
€ 1,065,295
€ 1,087,201
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
€0
€0
€ 1,099,776
-€ 22,883
-€ 6,256
€ 1,037,697
-€ 3,005
-€ 1,502
€ 1,083,025
€ 994,027
-€ 11,934
-€ 8,141
-€ 34,796
€ 1,015,776
-€ 12,824
-€ 8,105
-€ 16,062
€ 1,034,096
-€ 7,726
€ 1,055,856
-€ 28,305
€ 1,117,794
-€ 3,259
-€ 1,629
-€ 6,276
-€ 6,568
€ 1,094,211
-€ 45,278
-€ 16,535
€ 1,003,482
€ 15,953,768
-€ 9,763
-€ 30,082
Present
Value @
7.10%
€ 1,066,025
€ 938,504
€ 915,016
€ 785,574
€ 747,305
€ 711,449
€ 678,108
€ 670,208
€ 612,720
€ 523,717
€ 8,034,680
€ 15,683,306
€0
€ 15,683,306
8.0%
€ 1400000.0
7.0%
€ 1200000.0
6.8%
6.9%
6.8%
7.2%
7.0%
6.7%
7.1%
6.8%
7.0%
6.5%
6.0%
5.0%
€ 800000.0
4.0%
€ 600000.0
Running yield
Rental income
€ 1000000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,208,820
€ 7.97
Market rental value
total p.a.
per m²/month
€ 1,085,152
€ 7.16
11.40%
Over-/Underrent
Year 8
Total
€ 15,700,000
per m²
€ 1,243
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
7.00%
6.22%
Gross Initial Yield
8.22%
7.38%
Total
€ 14,700,000
per m²
€ 1,164
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 29 January 2014, the main tenant, Kaufland Dienstleistung GmbH & Co. KG, has good covenant
strength, which ensures a secure cash flow for the remainder of the lease term until at least 2027. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and
building age, third-party usability, competition situation and location.
assumed that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 5.50/m² per annum.
Regarding comparable rents, we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the
section "Investment Comparables". Taking into account the very good micro-location in a small city in eastern Germany but still close to Berlin, we have the opinion that this property should be transacted at a
multiplier slightly lower than the middle of the range of the observed comparables.
The following changes occurred in comparison to previous valuation: The WALT remained almost unchanged. According to the information provided to us 995 m² of leisure area are let to the new tenant iFitness
GmbH (former Takke). The lease started in April 2013 with a rent of € 5.65/m². The lease with fitness centre was concluded until April 2023. Two new leases are concluded for each 51 m² for Zebra two GmbH and
for Heiderich until September 2023 and April 2023 respectively. The lease of the tenants Haarmex.de (125 m²) and Johae Fleischprodukte GmbH & Co. KG (67 m²) were prolonged by 5 years. The tenant AWG has
reduced the rent by € 427/month to € 4,393/month.
Page 10 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Photos
View of the main entrance
External view
External view
View of the underground garage
Page 11 of 12
abc
Property address
Property no.
10
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
14974 Ludwigsfelde
Inspection date:
01.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Kaufland
Real
Wal Mart
Real
Floristik '99
Local chain
Frisör Klier
0
City
Crimmitschau
Braunschweig
Salzgitter
Bitterfeld
Schönebeck (Elbe)
Freital
Halle
0
Property Type
Flower store
Optician
Haircutter
0
Area
1,800 m²
19,688 m²
6,250 m²
16,866 m²
62 m²
123 m²
74 m²
0 m²
Total Rent p.m.
€ 8,136
€ 104,150
€ 38,750
€ 115,532
€ 1,406
€ 2,743
€ 2,211
€0
Rent p. sqm
€ 4.52 /m²
€ 5.29 /m²
€ 6.20 /m²
€ 6.85 /m²
€ 22.67 /m²
€ 22.30 /m²
€ 29.88 /m²
€ 0.00 /m²
Comment
Similar purchasing power, other federal state
Purchasing power of 105.5
Rental income includes sub tenants with higher rents
Purchasing power of 83.6, located in a retail park
Similar purchasing power, smalll lettable area
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
11
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Adler Modemärkte AG
Total lettable area
Total parking units
10,270 m²
550 units
12.3%
3.8 years
1974
2001
total p.a.
per m² / month
€ 1,381,692
€ 11.21
total p.a.
per m² / month
€ 109,957
€ 0.89
total p.a.
per m² / month
€ 1,271,734
€ 10.32
total p.a.
€ 1,276,200
14.1%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Good tenant mix
Well-known anchor tenant
Good connections to the motorway network via the A 6
0
High level of competition (Rewe, Aldi and Kaufland nearby)
Building almost 40years old (without refurbishment)
Vacancy rate of approx. 12%
Basement area in the Adler unit
Opportunities
Threats
Prolognation of the lease contract after expiry
Growing importance of the area
0
0
Drop out of tenants before expiry of the contracts
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
3
3
2
2
11 to 15 years
Between 10,000 and 12,500 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
3
3
2
Investment Quality
WALT
Over- / underrent
Quality of tenants
3 Tenants with good credit rating
Investment market
Investment volume
Saleability
4 Good lot size
The property, which consists of three parts, was built in 1973 and was completed in 1974. In the west of the property, there is a 1 to 2-storey building with a basement level. Retail stores and shops are located in the
first floor. In the ground level are administration and stockrooms. Furthermore there are some vacant areas in this property. This main building has two entrances: one is located near the parking area and another
one is located by the street corner "Hohenloher Straße" and "Heilbronner Straße". Adjacent to this building, a small 1-storey building is located with some small retail stores. These small retail stores have their own
entrances. In the east, there is another small 1-storey building with the use carwash and offices. This is currently rented by TÜV and Ümit Ebem. The external area offers a large parking area. The property is open
to all sides and includes a ramp to the basement level for deliveries. The roofs are mainly flat. The panels consist of prefabricated multi-layer concrete panels with thermal insulation.
The carwash and TÜV building is designed with simple brickwork walls. The main tenants are Adler and Lidl.
Valuation Results
Market Value
€ 16,800,000
equals to
Market Rental Value
€ 1,597 per m²
€ 1,276,200 p.a.
Discount Rate
7.50%
Net Initial Yield
7.31%
Capitalisation Rate
7.00%
6.71%
excluding
capital
expenditures
Page 1 of 12
€ 10.36 / m² / p.m.
equals to
7.13%
11.87
6.55%
12.85
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Location
Germany
Baden-Wurttemberg
Heilbronn (Rural District)
Neckarsulm
74172
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Neckarsulm
10,786,227
328,731
26,598
12,410
299
1066
2.8%
0.3%
0.1%
3.9%
3.6%
District
City
Federal State
District
District
in m €
in m €
index
index
index
7,381
561
107.20
102.28
78.00
Macro Location
Neckarsulm is located in the north-east of the federal state Baden-Wurttemberg. The state capital,
Stuttgart (population 602,000), is only 59 km away and Mannheim (population 311,969) is only 77 km
away.
The closest motorway is the A6, connecting to Amberg in the federal state Bavaria to the east and to
Saarbrücken near the French border to the west. The motorway can be accessed in less than 2 km.
Furthermore, the A81, connecting to Würzburg to the north-east to Singen (close to the Swiss border) to
the south-west, can be reached within a 7 km distance. Neckarsulm has a train station, which connects
Neckarsulm to the cities of Stuttgart and Munich via regional trains.
The nearest airport offering connections to national and international destinations is Stuttgart, about 59
km away. Furthermore, the Karlsurhe airport is located in a distance of approx. 91 km.
Efficient industrial companies, innovative service providers and medium-sized companies are located in
Neckarsulm and are known internationally. Well-known companies located in Neckarsulm include Audi,
Lidl and Kolbenschmidt-Pierburg. Furthermore, Neckarsulm is also recognized as very good site for the
IT branch.
Micro Location
Micro Location
The property is located in the south of Neckarsulm near the motorway A 6. The surrounding area is
characterised by discounters like Aldi, Rewe and Zeeman. The property is located along the Hohenloher
Straße and is very good visible. A small bus station is situated next to the western side of the property.
The property itself is located beside a residential area.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
280
5.0
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
32,520 m²
4,800 m²
Ground lease
No
n.a.
Ground lease expiry
€ 92 /sqm
€ 441,600
Site servicing
Fully serviced
Almost square
Site layout
Soil contamination
No
Comment
The site consists of one plot 1900: The site has an even topography. The site is accessible from the
north by car and the east by foot. The site has a trapezoidal shape. According to the Environmental Due
Diligence Report, dated July 2007, a filling station was installed east of the mall in 1974. Because of this
use, a suspicion of contamination exists. Operation of the filling station ceased in 1995. Later, this
location was used as vacuum cleaner area, car repair shop and carwash. At the moment, a part of this
space is rented by the TÜV and Ümit Ebem
building contamination. Furthermore, for purpose of this valuation, we assumed the land value pursuant
to the committee of experts of Neckarsulm.
Town Planning
Use class
SO (special zone)
0.8
Plot ratio (GFZ)
n.a.
Cubic index (BMZ)
4.0
Comment
According to information from the local planning authority, a development plan exists, entitled "Südstadt
Nr. 14.01/5" and dated 30.07.2004, with the following regulations: the subject site is located in special
zone ("Sondergebiet"). The cubic density (Baumassenzahl, BMZ) is 4.0 and the site coverage ratio
(Grundflächenzahl, GRZ) is 0.8.
Tenure
Land Register
Owner
TPL Neckarsulm S.á.r.l.
Local Court of
Heilbronn, land register (Reg. Nr.: B 128.750),
Luxembourg
of Neckarsulm
Sheet
4771
Plot
NO 6512
Parcel
1900
Limited personal easements (regarding the
omission of the food offer on an area of more
than 1200sqm sales area) in favour of Kaufland
Stiftung & Co. KG, Neckarsulm.
Section 3 (Loans)
Page 3 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Rewe
Kaufland
Kaufland
Kaufland
Rewe
Kaufland
Kaufland
E-aktiv Markt
E-neukauf
0
0
0
Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
0
0
Address
74076 Heilbronn, Etzelstr. 38-44
74080 Heilbronn, Neckargartacher Str. 111
74177 Bad Friedrichshall, Industriestr. 12
74072 Heilbronn, Olgastr. 57-77
74074 Heilbronn, Schmollerstr. 42
74189 Weinsberg, Haller Str. 59
74074 Heilbronn, Stuttgarter Str. 85
74081 Heilbronn, Mauerstr. 78-90
74248 Ellhofen, Bahnhofstr. 44
0
0
Sales area
1,991 m²
3,700 m²
3,000 m²
4,400 m²
1,900 m²
3,000 m²
4,150 m²
2,400 m²
2,500 m²
m²
m²
m²
Distance
3.40 km
4.30 km
5.30 km
5.40 km
5.90 km
6.50 km
6.50 km
7.10 km
7.20 km
0.00 km
0.00 km
Potential
Medium
Medium
low
low
low
low
low
low
low
0
0
0
92,908
148,048
7,381
20,771
43,797
69,259
2.8%
102.28
78.00
Page 4 of 12
3.6%
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
11
Main competitors
This competitor is a hypermarket located east of the subject property. The main tenant is REWE. The
This competitor is an small retail park located east of the subject property. The property is a serious
property is a serious competitor.
competitor.
Competition Comment
The catchment area can be differentiated into primary (0 – 5 min driving distance); secondary (5 – 10 min) and tertiary (10 – 15 min) catchment areas. Approximately 35,230 inhabitants live in the primary catchment
area. The density of hypermarkets is relatively high in the primary and secondary areas, the competition eases in the tertiary catchment areas. In a spatial environment of less than 1.5 km, there are three
competitors.
There are two competitors in the vicinity. As the main tenants of the valued property include Adler, Takko Fashion and Lidl, the neighbouring discounters, such as Aldi, Rewe and Kik pose as direct competitors.
The discounter Rewe and the small retail park are apparently newer than the valued shopping centre. They also target the same customer segment with the specific range of products. In contrast to its competitors,
1.3 km away. This is a big retail park with the main tenant Kaufland. A shopping mall connects directly to this property, with tenants such as Saturn, C & A, Toom, Deichmann, Walmart and various other restaurants
and shops. The competing property has signposts on the motorway, and offers very good and ample parking. It is clearly also in very good condition. The valued property has a much smaller size and appeals to a
slightly different audience, because there are some shops from the low-price segment.
Even though the properties may attract different customers and have slightly different primary catchment areas, the catchment areas strongly overlap, resulting in a high number of retail hypermarkets for a city with
only 27,000 inhabitants, which can be problematic. Overall, it can be said that the competition level in Neckarsulm is high, especially due to the existence of an relative hight retail density.
0
Turnover analysis
normally ranges between 2% and 15% depending on the respective branch. The productivity varies between approx. 1,000 €/m² up to more than 10,000 €/m². For the evaluation object there are turnover rents for
several tenants. We have been provided with the turnover rents for the tenants dm Drogerie and Härdtner. For the purposes of this valuation, we have assumed that the turnover rent are sustainable and have
included until the end of the respective lease agreement. We have not been provided with any turnover figures for Adler. For the purpose of this valuation, we have assumed that the area productivity of Adler is in a
healthy range and that the rent-to-turnover ratio is in the region of 12.3%, which is slightly above the range of 6-12% for fashion stores.
Due to the rent-to turnover ratio above the general range and the internal layout of the Adler unit with a share of rather substandard areas in the lower storey, we have aplied a market rental value which is lower that
the contractual rent. (The precisely figures regarding the productivity and rent-to-turnover ration an page 8)
Conclusion
The property in Neckarsulm is located in the direct vicinity of several serious competitors. The subject property currently has a retail use. Advantageous for this property are the high number of parking spaces and
the centrality of the tenant mix. The problems, however, are the age of the property, the vacant space and the high density of competitors. Regarding the third-party use, the current use is considered the best
option.
The leasing capacity is for this property medium because of the building age and the high density of competitors. Excluding the area of the Adler. The leasing capacity for this area is not very good. Because this
area extends over two floors and one of them is the enlarged basement area.
0
Page 5 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
1 Frau Monika Poschmann
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Tenant
pays *
Retail
Let
99
€ 2,286
23.08
Yes
01.04.2014
31.03.2024
75%
GT I PM
2 Lidl Vertriebs-GmbH & Co.KG
Retail
Let
1,200
€ 10,341
8.61
Yes
24.03.1997
23.03.2023
75%
GT I PM
Storage
Let
294
€0
0.00
Yes
24.03.1997
23.03.2023
75%
GT I PM
4 Ümit Ebem
Storage
Let
291
€ 1,557
5.36
n.a.
01.01.2011
31.12.2020
75%
M GT I PM
5 Ümit Ebem
Other Units
Let
480
€ 504
1.05
Yes
01.01.2011
31.12.2020
75%
GT I PM
6 Ümit Ebem
Office
Let
58
€ 311
5.35
Yes
01.01.2011
31.12.2020
75%
GT I PM
7 TÜV SÜD Auto Service GmbH
Retail
Let
197
€ 906
4.61
Yes
15.10.2010
14.10.2020
75%
GT I PM
8 Serbetcioglu
Retail
Let
50
€ 1,117
22.25
Yes
31.05.2013
31.05.2018
75%
GT I PM
Retail
Let
1,282
€ 11,598
9.04
Yes
01.10.2002
30.09.2017
75%
GT I PM
10 Schwäbische Wurst Spezialität.
Retail
Let
119
€ 2,250
18.94
Yes
21.09.2007
22.09.2017
75%
11 Härdtner GmbH
Retail
Let
116
€ 5,600
48.38
Yes
21.09.2007
20.09.2017
75%
Retail
Let
61
€ 2,084
34.11
Yes
21.09.2007
20.09.2017
75%
GT I PM
GT I PM
13 mister*lady GmbH
Storage
Let
24
€ 64
2.68
Yes
15.06.2007
14.06.2017
75%
14 mister*lady GmbH
Retail
Let
500
€ 5,621
11.25
Yes
15.06.2007
14.06.2017
75%
15 Adler Modemärkte AG
Retail
Let
3,359
€ 35,732
10.64
Yes
27.03.1997
31.03.2017
75%
16 Reno Schuhcentrum GmbH
Retail
Let
708
€ 8,501
12.00
Yes
24.03.2007
23.03.2017
75%
GT I PM
GT I PM
Storage
Let
121
€ 477
3.95
Yes
24.03.2007
23.03.2017
75%
18 Kreisparkasse Heilbronn
Retail
Let
5
€ 315
69.98
Yes
10.12.2006
31.12.2016
75%
19 Ernsting's family Gmbh & Co. KG
Retail
Let
164
€ 2,123
12.97
Yes
06.09.2007
31.12.2016
75%
20 Meister Rapid e.K. Inh. Geviye Taber
Retail
Let
23
€ 833
35.79
Yes
01.10.2006
30.09.2016
75%
GT I PM
Retail
Let
712
€ 9,548
13.41
Yes
28.04.2007
27.04.2016
75%
GT I PM
Storage
Let
46
€ 136
2.99
Yes
28.04.2007
27.04.2016
75%
GT I PM
Retail
Let
73
€ 1,226
16.70
Yes
01.12.2010
30.11.2015
75%
23 Mustafa Kabayel (ehem.Dilek)
GT I PM
GT I PM
GT I PM
Retail
Let
64
€ 851
13.35
Yes
01.04.2011
31.03.2015
75%
GT I PM
25 Siemens Building Technologiers
Storage
Let
68
€ 510
7.53
Yes
01.12.2002
30.11.2014
75%
GT I PM
Storage
Let
45
€0
0.00
Yes
01.12.2002
30.11.2014
75%
GT I PM
24 Serbetcioglu
Storage
Let
21
€0
0.00
Yes
01.12.2002
30.11.2014
75%
GT I PM
Other Units
Let
1
€0
0.00
Yes
01.06.2007
30.11.2014
100%
GT I PM
29 Stuck
Storage
Let
47
€ 162
3.47
Yes
27.06.2005
30.09.2014
75%
GT I PM
30 Pura GmbH
Storage
Let
11
€ 56
5.01
Yes
01.03.2003
30.09.2014
75%
Retail
Let
54
€ 1,210
22.46
Yes
31.08.2007
30.08.2014
75%
GT I PM
Other Units
Let
1
€ 221
220.83
Yes
03.08.2009
02.08.2014
100%
GT I PM
33 Gabriel
Retail
Let
59
€ 1,685
28.36
Yes
25.08.2007
24.07.2014
75%
GT I PM
34 Stadt Neckarsulm Liegenschaftsabt.
Retail
Let
10
€1
0.09
Yes
01.07.1987
30.06.2014
75%
100%
GT I PM
27.03.1997
31.03.2017
100%
GT I PM
03.08.2009
02.08.2014
100%
00.01.1900
27.04.2016
100%
0%
27.03.1997
31.03.2017
100%
GT I PM
35 LEERSTAND (ex. PM Trends)
Storage
Vacant
15
€0
0.00
Storage
Vacant
42
€0
0.00
37 LEERSTAND (ex.Schwaderer)
Storage
Vacant
38
€0
0.00
38 LEERSTAND (Schmidt)
Other Units
Vacant
572
€0
0.00
Other Units
Vacant
307
€0
0.00
Retail
Vacant
186
€0
0.00
41 LEERSTAND
Storage
Vacant
26
€0
0.00
42 LEERSTAND
Storage
Vacant
29
€0
0.00
43 LEERSTAND
Storage
Vacant
35
€0
0.00
44 LEERSTAND
Storage
Vacant
18
€0
0.00
45 KZM (kiosk)
Other Units
Let
1
€ 185
185.00
Yes
Other Units
Let
1
€0
0.00
Yes
Other Units
Let
1
€ 46
46.00
Other Units
Let
1
€ 7,084
7084.00
External parking
Let
550
€0
0.00
10,270 m²
€ 115,141
48 Turnover Rent
49 Parking Spaces
Total
Yes
GT I PM
0%
Page 6 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Area Category
Tenant Name
1 Frau Monika Poschmann
Area
sqm/unit
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
Retail
99
€ 20.00
€ 1,981
€ 100
0
15
0
3
5
25%
Retail
1,200
€ 10.00
€ 12,004
€ 50
0
12
0
3
10
25%
Storage
294
€ 2.25
€ 662
€ 50
0
12
0
3
10
25%
4 Ümit Ebem
Storage
291
€ 4.25
€ 1,236
€ 25
0
18
0
3
10
25%
5 Ümit Ebem
Other Units
480
€ 1.00
€ 480
€0
0
18
0
3
10
25%
6 Ümit Ebem
Office
58
€ 4.25
€ 247
€ 25
0
18
0
3
10
25%
7 TÜV SÜD Auto Service GmbH
Retail
197
€ 4.25
€ 836
€ 25
0
18
0
3
10
8 Serbetcioglu
Retail
50
€ 20.00
€ 1,004
€ 100
0
15
0
3
5
25%
Retail
1,282
€ 9.50
€ 12,183
€ 50
0
12
0
3
5
25%
10 Schwäbische Wurst Spezialität.
Retail
119
€ 20.00
€ 2,375
€ 100
0
15
0
3
5
25%
11 Härdtner GmbH
Retail
116
€ 50.00
€ 5,787
€ 100
0
15
0
3
5
25%
Retail
61
€ 27.50
€ 1,681
€ 100
0
15
0
3
5
25%
0
5
25%
13 mister*lady GmbH
Storage
24
€ 2.25
€ 54
€0
14 mister*lady GmbH
Retail
500
€ 12.00
€ 5,995
€ 100
0
15
0
3
5
25%
15 Adler Modemärkte AG
Retail
3,359
€ 8.50
€ 28,548
€ 50
0
12
0
3
10
25%
Retail
708
€ 12.00
€ 8,501
€ 100
0
15
0
3
5
25%
Storage
121
€ 2.25
€ 272
€0
0
12
0
3
5
25%
0
3
0
0
18 Kreisparkasse Heilbronn
Retail
5
€ 69.98
€ 315
3
5
19 Ernsting's family Gmbh & Co. KG
Retail
164
€ 12.50
€ 2,046
€ 100
0
15
0
3
10
25%
20 Meister Rapid e.K. Inh. Geviye Taber
Retail
23
€ 27.50
€ 640
€ 100
0
15
0
3
5
25%
Retail
712
€ 12.00
€ 8,544
€ 100
0
15
0
3
5
25%
Storage
46
€ 2.25
€ 102
€0
0
12
0
3
5
25%
Retail
73
€ 20.00
€ 1,468
€ 100
0
15
0
3
5
25%
Retail
64
€ 12.50
23 Mustafa Kabayel (ehem.Dilek)
24 Serbetcioglu
€ 797
€0
€0
0
12
25%
0
12
0
3
5
25%
25%
Storage
68
€ 2.25
€ 152
€0
0
12
0
3
5
25%
Storage
45
€ 2.25
€ 102
€0
0
12
0
3
5
25%
25%
29 Stuck
30 Pura GmbH
33 Gabriel
34 Stadt Neckarsulm Liegenschaftsabt.
Storage
21
€ 2.25
€ 48
€0
0
12
0
3
5
Other Units
1
€ 0.00
€0
€0
0
0
0
3
5
0%
Storage
47
€ 2.25
€ 105
€0
0
12
0
3
5
25%
Storage
11
€ 2.25
€ 25
€0
0
12
5
25%
Retail
54
€ 20.00
€ 1,078
€ 100
0
15
0
3
5
25%
Other Units
1
€ 220.83
€ 221
€0
0
0
0
3
5
0%
Retail
59
€ 20.00
€ 1,188
€ 100
0
15
0
3
5
25%
Retail
10
€ 0.09
€1
€0
0
0
0
3
5
25%
Storage
15
€ 1.80
€ 26
€0
15
0
0
3
5
100%
3
€ 95
€0
15
0
100%
42
€ 2.25
0
3
5
Storage
38
€ 2.25
€ 86
€0
15
0
0
3
5
100%
Other Units
572
€ 1.50
€ 858
€0
15
0
0
3
5
100%
Other Units
307
€ 1.50
€ 461
€0
15
0
0
3
5
100%
Retail
186
€ 20.00
€ 3,720
€0
15
0
0
3
5
100%
37 LEERSTAND (ex.Schwaderer)
41 LEERSTAND
Storage
0
Storage
26
€ 1.80
€0
21
0
0
3
5
100%
42 LEERSTAND
Storage
29
€ 1.80
€ 52
€0
15
0
0
3
5
100%
43 LEERSTAND
Storage
35
€ 1.80
€ 63
€0
12
0
0
3
5
100%
44 LEERSTAND
Storage
18
€ 1.80
€ 32
€0
12
0
0
3
5
100%
45 KZM (kiosk)
Other Units
1
€ 185.00
€ 185
€0
0
0
0
0
0
0%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
0
0%
1
€ 46.00
48 Turnover Rent
49 Parking Spaces
Total
* months
Other Units
€ 47
€ 46
€0
0
0
5
0%
Other Units
1
€ 0.00
€0
€0
0
0
0
0
0
0%
External parking
550
€ 0.00
€0
€0
0
0
0
0
10
0%
10,270 sqm
** years
0
3
€ 106,350
Page 7 of 12
.
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
58
9,041
0
0
0
0
1,170
10,270
0
1,365
0
550
1,915
Area Vacant
m²
0
186
0
0
0
0
203
389
0
879
0
0
0
Area Let
m²
58
8,855
0
0
0
0
968
9,881
0
486
0
550
550
Vacancy Rate
%
0.00%
2.06%
0.00%
0.00%
0.00%
0.00%
17.33%
3.79%
0.00%
64.40%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
5.35
11.73
0.00
0.00
0.00
0.00
3.06
0.00
16.54
11.65
0.00
0.00
Contractual
Rent
€/month
311
103,828
0
0
0
0
2,963
0
8,040
115,141
0
0
Contractual
Rent
€/year
3,728
1,245,936
0
0
0
0
35,550
0
96,478
1,381,692
0
0
Potential
Rent
€/year
3,728
1,270,794
0
0
0
0
42,122
0
113,873
1,430,517
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
4.25
11.14
0.00
0.00
0.00
0.00
2.70
0.00
1.65
10.36
0.00
0.00
Market
Rent
€/month
247
100,693
0
0
0
0
3,160
0
2,251
106,350
0
0
Market
Rent
€/year
2,959
1,208,311
0
0
0
0
37,921
0
27,009
1,276,200
0
0
Over-/ UnderRented
26.0%
5.3%
0.0%
0.0%
0.0%
0.0%
13.4%
0.0%
903.5%
12.5%
0.0%
0.0%
Assessment of Adler market rent
Space productivity
2,000
12.00
1,800
11.00
Explanation
Market rent
10.00
9.65
1,600
Contractual Rent
9.00
8.50
Rent / m² / month
1,400
1,200
1,200
1,000
800
%
€ / m²
Contractual
13.2%
10.64
Market
10.6%
8.50
Rents
8.00
7.24
7.00
6.00
4% of turnover
9.65
5.00
3% of turnover
7.24
4.82
Turnover potential
2.00
1.0%
in € / m² p.a.
3,240,000 €
(net)
3.00
400
4.82
2% of turnover
4.00
600
Sales Area
3.0%
based on sales area
5.0%
7.0%
9.0%
11.0%
13.0%
Total Area
~ 2,700 m²
3,359 m²
Turnover-rent-ratio
Textile stores usually can afford to pay a rent in the range of 6-12% of their net turnover (economically sustainable rent burden) and have a space productivity of about € 800 to € 1,600 (in shopping centers up to €
3,000) per m² sales area. The graphic above indicates, how the contract rent of the main tenant 'Adler' and the assumed market rental level can be assessed on usual market ranges and an assumed average
space productivity of € 1,200 (net).
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Adler Modemärkte AG
€ 428,783
31%
3.2 years
79
5A 2
2
84
€ 1,850,000 (single) € 154,000,000 (total)
The main tenant is Adler Modemärkte AG. The Adler fashion stores carry a broad assortment, adaptable
fashion for the whole family. Adler is one of the major textile retailers in Germany. According to Dun &
Bradstreet (D&B) Rating as at 29 January 2014. Adler Modemärkte AG has an small credit risk. The risk
of insolvency (D&B Score) within the next 12 months compared with other German companies is
assessed to be low, i.e. 84% of businesses on the German database have the same or higher risk of
failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
11
Market Value
The property has a vacancy rate of approx. 12%, the remaining area is let to 32 tenants. The WALT of the property amounts to 3.8 years. The main tenant is Adler with a share of approx. 30% of the rental income.
The property is currently over-rented. This figure included the turnover rents of the tenants dm Drogerie, Takko Fashion, mister Lady, Reno and Härdtner, which we are of the opinion that is to be sustainable until
the end of the respective lease contracts. Without these turnover rents the property is nearly let at market level. The majority of the tenants pay all costs (including ground tax, insurance costs and management
costs) except for maintenance costs for structural repairs. The rest can be apportioned to the tenant in accordance with the German Regulation on Operating Costs. Furthermore, some rental increases due to
indexations have taken place.
0
Discount rate
7.50%
Capitalisation rate
7.00%
reinsurance, the initial yields profile is aligned with the market/other transactions.
We have taken into account such facts as the uncertainty of the main tenant Adler and the period of his
lease contract, the worse condition and location (referring to the competitor situation), and the short
WALT.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 6.50 /m²
€ 2.02 /m²
€ 1.78 /m²
€ 0.41 /m²
€ 0.00 /m²
€ 10.71 /m²
€ 66,752
€ 20,725
€ 18,273
€ 4,207
€0
€ 109,957
per year
per year
€ 6.50 /m²
€ 1.86 /m²
€ 1.78 /m²
€ 0.41 /m²
€ 0.00 /m²
€ 10.55 /m²
€ 66,752
€ 19,143
€ 18,273
€ 4,207
€0
€ 108,375
Inflation
% of Gross
Contract Rent
4.83%
1.50%
1.32%
0.30%
0.00%
7.96%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.23%
1.50%
1.43%
0.33%
0.00%
8.49%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 66,752
€ 67,820
€ 69,027
€ 70,242
€ 71,380
€ 72,508
€ 73,668
€ 74,861
€ 76,044
€ 77,170
€ 78,296
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 20,222
€ 21,473
€ 20,527
€ 16,331
€ 19,603
€ 19,756
€ 19,499
€ 19,120
€ 19,297
€ 19,641
€ 21,597
Insurance
Costs
€ 4,207
€ 4,274
€ 4,350
€ 4,427
€ 4,499
€ 4,570
€ 4,643
€ 4,718
€ 4,793
€ 4,864
€ 4,935
Ground
Tax
€ 18,273
€ 18,565
€ 18,896
€ 19,228
€ 19,540
€ 19,849
€ 20,166
€ 20,493
€ 20,817
€ 21,125
€ 21,433
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 114,227
€ 113,057
€ 115,622
€ 128,428
€ 115,463
€ 116,736
€ 120,755
€ 124,462
€ 125,712
€ 129,366
€ 126,697
Vacancy
Costs
€ 4,773
€ 925
€ 2,822
€ 18,200
€ 441
€ 53
€ 2,779
€ 5,270
€ 4,761
€ 6,566
€ 436
% of Total
Gross Revenue
8.5%
7.9%
8.4%
11.8%
8.8%
8.9%
9.3%
9.8%
9.8%
9.9%
8.8%
14.0%
11.8%
12.0%
10.0%
8.5%
8.4%
8.8%
8.9%
9.3%
9.8%
9.8%
9.9%
7.9%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Cash Flow
Market Value
Rental
Revenue
€ 1,437,624
€ 1,437,833
€ 1,410,981
€ 1,321,637
€ 1,321,677
€ 1,322,703
€ 1,333,391
€ 1,334,362
€ 1,352,909
€ 1,416,544
€ 1,454,977
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 63,661
-€ 6,304
-€ 42,520
-€ 232,903
-€ 14,839
-€ 5,631
-€ 33,467
-€ 59,681
-€ 66,415
-€ 107,176
-€ 15,197
Rent
Abatements
-€ 25,834
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 1,348,129
€ 1,431,529
€ 1,368,461
€ 1,088,734
€ 1,306,838
€ 1,317,072
€ 1,299,924
€ 1,274,681
€ 1,286,494
€ 1,309,368
€ 1,439,780
Nonrecoverable
Costs
-€ 114,227
-€ 113,057
-€ 115,622
-€ 128,428
-€ 115,463
-€ 116,736
-€ 120,755
-€ 124,462
-€ 125,712
-€ 129,366
-€ 126,697
Net
Operating
Income
€ 1,233,902
€ 1,318,472
€ 1,252,839
€ 960,306
€ 1,191,375
€ 1,200,336
€ 1,179,169
€ 1,150,219
€ 1,160,782
€ 1,180,002
€ 1,313,083
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 1,486
-€ 904
€ 1,231,512
-€ 16,939
-€ 14,334
€ 1,287,199
-€ 20,304
-€ 7,927
€ 1,224,608
€ 842,763
-€ 80,876
-€ 36,667
-€ 26,382
€ 1,146,506
-€ 18,487
-€ 1,084
€0
€ 1,199,252
-€ 6,262
€ 1,162,890
-€ 10,017
€ 1,140,554
-€ 5,882
-€ 3,783
-€ 17,212
-€ 45,778
€ 1,097,792
-€ 40,330
-€ 24,906
€ 1,114,766
€ 18,952,052
-€ 3,811
-€ 4,369
Present
Value @
7.50%
€ 1,191,418
€ 1,157,755
€ 1,026,058
€ 658,134
€ 829,525
€ 808,287
€ 728,691
€ 665,492
€ 596,160
€ 561,346
€ 9,195,421
€ 17,418,287
€ 470,304
€ 17,888,591
8.0%
€ 1600000.0
6.9%
7.4%
7.0%
€ 1400000.0
6.7%
6.7%
6.6%
6.4%
6.5%
6.6%
7.0%
6.0%
€ 1200000.0
€ 1000000.0
5.0%
€ 800000.0
4.0%
€ 600000.0
3.0%
€ 400000.0
2.0%
€ 200000.0
1.0%
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 1,381,692
€ 11.21
Market rental value
total p.a.
per m²/month
€ 1,276,200
€ 10.36
14.10%
Over-/Underrent
Year 8
Running yield
Rental income
5.4%
Total
€ 17,900,000
per m²
€ 1,694
Purchaser's costs
6.50%
Yield Overview
Net Initial Yield
7.31%
6.71%
Gross Initial Yield
8.42%
7.78%
Total
€ 16,800,000
per m²
€ 1,597
Valuation Comment
In terms of risk, we considered the covenant strength of the tenants as well as the lease duration for the existing contracts. As at 29 January 2014 the main tenant Adler Modemärkte GmbH has good covenant
strength, which ensures a secure cash flow. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building age, third-party usability, competition and
location.
assumed that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 6.50/m² per annum. Regarding
comparable rents we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the section
"Investment Comparables". Furthermore, we have taken into account surplus land in the amount of 4,800m² and have considered the standard land value of € 92/m² for this space.
The following changes occurred in comparison to previous valuation: The WALT slightly decreased to 3.8 years. According to the information provided to us the vacancy rate increased by 11% to 12.3%. The
tenants P&M Trends, Schmidt and Schwaderer have canceled their leases. The rent of the tenant Mister Lady GmbH and Kreissparkasse Heilbronn has slightly increased due to the indexation. 99 m² of the retail
area are let to the new tenant Monika Poschman. The lease starts in April 2014, has granted 3 months rent free after handover and a lease term of 10 years. A further 50 m² of retail area are let to the new tenant
Serbetcioglu. The lease stated in May 2013 with a rent of € 21.29/m² and will remain until May 2018.
Page 10 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Photos
Front view of the western property part
External view of the TÜV
Front view of the eastern property part
View of bakery in main building
Page 11 of 12
abc
Property address
Property no.
11
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
74172 Neckarsulm
Inspection date:
28.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Lidl
Lidl
Lidl
Lidl
Adler
Adler
AWG Textil
0
City
Renchen
Braunschweig
Kerken
Wurzen
Nürnberg
Krefeld
Volkach
0
Property Type
Discounter
Discounter
Discounter
Discounter
Fashion
Fashion
Fashion
0
Area
1,320 m²
994 m²
1,103 m²
1,099 m²
2,862 m²
2,807 m²
1,000 m²
0 m²
Total Rent p.m.
€ 10,798
€ 11,183
€ 12,354
€ 9,671
€ 34,344
€ 24,533
€ 8,900
€0
Rent p. sqm
€ 8.18 /m²
€ 11.25 /m²
€ 11.20 /m²
€ 8.80 /m²
€ 12.00 /m²
€ 8.74 /m²
€ 8.90 /m²
€ 0.00 /m²
Comment
Other federal state, worse purchasing power
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
12
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Kaufland Warenhandel GmbH & Co. KG
Total lettable area
Total parking units
10,230 m²
500 units
0.8%
9.5 years
1999
2007
total p.a.
per m² / month
€ 869,192
€ 7.08
total p.a.
per m² / month
€ 89,600
€ 0.73
total p.a.
per m² / month
€ 779,592
€ 6.35
total p.a.
€ 869,452
1.1%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Very good visibility from Aidenbacher Straße
Sufficient parking spaces on site
Very good accessibility to the parking area
Good branch and tenant mix
Established location, no further self-service department stores in immediate vicinity
Since completion one small retail unit (84m²) is still in shell condition
Limted third party usability of the large-scale retail area without refurbishment
0
0
0
Opportunities
Threats
Location could be strengthened by further completions in the surrounding area
Extension of the lease contract after expiration date
0
0
0
Long-term vacancy if Kaufland vacates the property
0
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
4
3
3
3
6 to 10 years
Between 10,000 and 12,500 m²
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
3
3
3
3
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
4 Good lot size
The property consists of two buildings on two parcels of land, which are separated by an access road. The buildings were constructed in 1999. On the south-western side of the property (land parcel 1552), a
predominately one-storey self-service department store can be found, which has an L-shaped layout. The sales areas are situated in the longer section of the building on the ground floor; in the shorter section of
the building, the warehouse as well as the receiving department can be found. The social rooms on the first floor can be reached through the entrance hall. The goods delivery area can be accessed via a loading
ramp. The building itself is a reinforced concrete construction with a flat roof. The façade has sandwich elements made from prefabricated concrete components. The façade and the roof of the social rooms are clad
with trapezoidal sheet metal. The parking facilities are situated in front of the covered entrance area of the self-service department store and extend up to the access road.
A U-shaped building can be found on the north-western section of the property (parcel 1552/7). The building is a single-storey construction. Parking areas can be found in front of the structure. The rental units are
each accessible from the parking areas. The goods delivery zones are situated in the rear building section and stretch around the building. The building is equipped with a flat roof. The façade is clad with aluminium
elements in the form of trapezoidal sheet metal. An awning covering the entrance areas optically connects the individual rental units with one another. A petrol station is located on the western end of the property
(parcel 1552/7). This section of the property is leased to the petrol station operator.
Valuation Results
Market Value
€ 11,100,000
equals to
Market Rental Value
€ 1,085 per m²
€ 869,452 p.a.
Discount Rate
6.75%
Net Initial Yield
6.66%
Capitalisation Rate
6.50%
6.67%
excluding
capital
expenditures
Page 1 of 12
€ 7.08 / m² / p.m.
equals to
6.66%
12.77
6.67%
12.77
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Location
Germany
Bavaria
Passau (Rural District)
Vilshofen
94474
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Vilshofen
12,595,891
187,610
16,179
7,290
123
187
-1.4%
0.5%
-0.7%
3.7%
3.8%
District
City
Federal State
District
District
in m €
in m €
index
index
index
3,544
316
109.20
94.62
90.22
Macro Location
Vilshofen an der Donau is a secondary centre in the Passau administrative district and the largest city in
the respective district. The city borders the southern Bavarian forest and is located approx. 20 km west
from Passau and around 30 km west from Austria. The regional centre, Regensburg, is situated about
100 km north-west of Vilshofen. As a secondary centre, Vilshofen functions as an economic hub for the
surrounding communities and supplies the area with periodic services. Small and medium-sized
businesses are predominantly established in the city, with the majority operating in the service sector as
well as the retail sector. The establishment of larger retail chains in the city makes Vilshofen a key
shopping location for the surrounding sub-centres. Having the largest number of schools in the Passau
administrative district, the education sector is equally economically important for the city.
The connection to the national motorway network can be described as good. The motorway A3 can be
accessed in approx. 15 minutes via the junction 113. The federal road B8 runs from Passau to
Straubing and connects Vilshofen with a variety of communities, including Künzing, Windor and the
regional centre Plattling in the Danube-Forest (Donau-Wald) region. Furthermore, the railway station
connects Vilshofen with the cities Regenburg, Passau and Munich. The closest railway station offering
long-distance services can be found in Passau and Plattling. The nearest airports are located in Munich
(approx. 140 km distance) as well as in Linz, Austria (approx. 130 km distance).
Micro Location
Micro Location
The subject property is located in Hösamer Feld in the Linda commercial zone, in the southern periphery
of Vilsohofen. It can be accessed via the arterial road, Aidenbacher Straße. The city centre is around 3
km north-east of the property and can be reached via Aidenbacher Straße. A Huber, a building
materials store which offers a wide range of building materials, tools, piping and metal sheeting, borders
the subject property to the north-east. To the south, the site is adjacent to the fashion and shoe retail
warehouse, Lipp. The wider surrounding area is characterised by agricultural use. According to
information from the City of Vilshofen, there are still around 27,000 m² of land available in the
commercial zone for development. This land is located south-west of a self-service department and
south-east of the retail warehouse assessed in the present valuation.
Furthermore, a bus stop is located by the subject property. The railway station is located approx. 2.4 km
away. The junction “Garham-Vilshofen”, which connects the city with the federal motorway A3, is about
12.5 km north of the property. The federal road B8 is almost 4.6 km away.
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
330
3.5
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Site Plan
Site Information
Site area
37,515 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Rectangular
Site layout
Soil contamination
No Suspicion
No
Comment
The property is constructed on a slight slope. Thus, the retail warehouses on parcel 1552/7 are on a
higher level than the self-service department store on the parcel 1552. The parcels are bordered by
Aidenbacher Straße on the north-west and Hösamer Feld on the south-east. The building materials
store, Huber, neighbours the parcel 1552/7 on the north-east; developable land is situated south-west of
the parcel 1552. Both parcels are separated by an access road.
There is no suspicion of contamination due to previous uses on the site. However, a section of parcel
1552/7 is currently leased to a petrol station. For the purposes of this valuation, we have assumed that
the subject property is free of any soil or building contamination.
Town Planning
Use class
SO (special zone)
0.8
Plot ratio (GFZ)
1.6
Cubic index (BMZ)
n.a.
Comment
According to information from the building authority of Vilshofen, a legally binding land-use plan, called
“Gewerbegebiet Linda II”, dated 25 October 1993, has been determined for the subject property. The
site is zoned as special zone (SO) and the use must have an open coverage type. The total sales area
is limited to 7,300 m², with non-city centre relevant product ranges being restricted to a maximum of 300
m². Other designations include a sales area for groceries for a maximum of 1,700 m², textile goods from
1,400 m² and for electronic goods of max 700 m².
Tenure
Land Register
Local Court of Passau,
land register of
Aunkirchen
Owner
TPL Vilshofen S.à.r.l.
Luxembourg
Sheet
2007
Plot
0
Parcel
1552
1552/7
Section 3 (Loans)
Limited personal easement in favour of Conoco
Mineralöl GmbH, Hamburg, registered until
30.09.2023 (right to sell fuel and vehicle lubricant, Frankfurt, 6 June 2011.
right to operate a petrol station)
Limited personal easement (right to operate a selfservice department store) in favour of Kaufland
Dienstleistungs GmbH & Co. KG, registered on
22.08.2007
Page 3 of 12
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
Rewe
0
0
Type
Hypermarket
Address
94474 Vilshofen, Passauer Str. 29
Sales area
1,600 m²
m²
m²
Distance
3.20 km
Potential
Medium
0
0
0
0
0
0
0
0
0
0
0
15,398
24,462
6,847
10,379
94.62
3,544
19,333
3.8%
-1.4%
90.22
Page 4 of 12
abc
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
12
Main competitors
A retail agglomeration with the tenants such as consumer electronics retailer (Expert), a drug store
(Rossmann), a fashion retailer Takko, two food discounters (Aldi and Penny), a beverage store and a
sport fashion store is located along the Aidenbacher Straße in a distance of approx. 1 km north to
the subject property. A DIY store (hagebaumarkt) is situated opposite the retail agglomeration.
A supermarket Rewe with a sales area of approx. 1,900 m² is located shortly behind the federal road B8.
The supermarket is located in a distance of approx. 3 km away within the secondary catchment area.
The Passauer Straße runs along the railway line until the Aidenbacher Straße begins. The competitor is
standalone.
Competition Comment
The retail warehouse agglomeration is situated in close proximity, within a 1 km distance from the valued property. The location of this competitor is however closer to the city centre. With a drugstore, two
discounters, a drinks cash-and-carry, a sporting goods store as well as a DIY store, the agglomeration overall offers a similar product range as the subject property. The majority of tenants are well-known retail
chains. The competing site is additionally strengthened by an electronics superstore. As a whole, the competing property offers also a different range of goods. While both the discounters offer lower-priced goods
for daily use, the Kaufland at the subject property in contrast presents a full range of goods. The retail warehouses at the valued site therefore strengthens the attractiveness level of the property. Additionally, the
fashion and shoe retail warehouse, which borders the subject site, indirectly benefits the subject property.
Thus, it can be assumed that despite the generally similar tenant mix, direct competition for the purchasing power of the consumers does not exist. The second competitor, Rewe, is also unable to pose as direct
competition to the subject property. For one, the city centre with smaller shopping facilities is situated between the subject site and the second competitor, Rewe. For another, the Rewe only offers a fraction of the
full range of goods available at Kaufland, thereby indicating a significant difference in the product ranges. Furthermore, no other retail establishments adjoin or border the Rewe, which could boost the quality of the
competing property over the subject property. Thus, the competition level as a whole can be described as medium.
0
Turnover analysis
The rents in functional retail agglomerations are linked to the achievable turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market
sectors. This rate normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m².
For Kaufland, we have also been provided with turnover figures for the previous valuation. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a turnoverto-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store. Taking into consideration location features and the competition situation within Vilshofen, a
higher rental level and turnovers for similar sectors is certainly realistic. Thus, we assume in the valuation that higher market rents for the self-service department store can be achieved after the expiry of lease
agreements.
Conclusion
The tenant and market sector mix is very good for the current type of use. The size of the property is sufficient to meet the needs of the community of Vilshofen and its catchment area. The accessibility and visibility
of both building sections can also be described as being very good. The only feature of the property that could be looked at critically is the small rental unit (84 m² in size), which is still in shell condition and has
remained vacant since being constructed. The other 200 m² of vacant area are now let to the existing tenant KiK a fashion retailer. Overall, the property can be expanded with the available building areas bordering
the site. A tenant mix with an electronics retail warehouse could further boost the subject site above the competition. The establishment of a similar type self-service department store is however considered
problematic. Protection against competition is currently not available. Furthermore, the property is highly dependent on the self-service department store, Kaufland, and also on the tenant, Vögele, who is the main
tenant in the retail warehouse centre.
If the tenant Kaufland were to vacate the unit, the self-service department store could be let in the future to other tenants, such as real, Marktkauf or an E-Center. However, a subsequent use of the unit as a DIY
store or furniture store would not be suitable. Huber (building materials store) as well as hagebaumarkt (DIY store) are already established in the vicinity and more than sufficiently meet the needs of the catchment
area. Furthermore, a furniture retailer also is not a strong enough anchor tenant and lacks the drawing power for consumers.
According to the turnover analysis, the turnover rent stands on the lower end of the range; in fact, a higher turnover-to-rent ratio is achievable in the market. Therefore, we assume that the tenant, Kaufland, will
exercise its lease agreement extension options and will remain in the property until 2037. Thereby, it can be assumed that over this period of time, demand for the other units will also exist.
Page 5 of 12
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Rent Roll
Tenant Name
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Retail
Let
5,187
€ 27,069
5.22
Yes
01.10.2007
30.09.2027
Retail
Let
200
€ 2,000
10.00
Yes
01.10.2013
26.07.2025
75%
Retail
Let
785
€ 7,934
10.11
Yes
27.07.2005
26.07.2025
75%
4 Charles Vögele Deutschland
Retail
Let
1,008
€ 10,729
10.64
Yes
01.03.1999
28.02.2024
75%
Retail
Let
348
€ 3,777
10.85
Yes
05.03.1999
04.03.2019
75%
Petrol Station
Let
1,400
€ 2,813
2.01
Yes
13.01.1999
30.09.2018
100%
75%
Tenant
pays *
75%
GT I PM
Retail
Let
704
€ 7,680
10.91
Yes
01.03.1999
28.02.2018
8 Deichmann SE
Retail
Let
452
€ 4,419
9.78
Yes
01.03.1999
28.02.2018
75%
Retail
Let
309
€ 2,057
6.66
Yes
11.03.1999
10.02.2018
75%
Retail
Let
335
€0
0.00
Yes
04.12.2000
31.12.2014
75%
GT I PM
Retail
Let
818
€ 3,690
4.51
Yes
04.12.2000
31.12.2014
75%
GT I PM
Other Units
Let
6
€ 265
44.17
Yes
03.08.2009
02.08.2014
75%
GT I PM
Retail
Vacant
84
€0
0.00
External parking
Let
500
€0
0.00
No
01.10.2007
30.09.2027
100%
11,630 m²
€ 72,433
13 VACANT
14 External Parking
Total
Page 6 of 12
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Area Category
Area
sqm/unit
Retail
5,187
€ 100
0
Retail
200
€ 9.00
€ 1,800
€ 350
0
Retail
785
€ 9.00
€ 7,065
€ 100
0
12
4 Charles Vögele Deutschland
Retail
1,008
€ 9.00
€ 9,072
€ 100
0
12
Tenant Name
Market
Rent
Market
Rent /month
€ 6.00
€ 31,119
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
Renewal
Probability
15
0
3
10
25%
12
0
3
5
25%
0
3
5
25%
0
3
5
25%
25%
Retail
348
€ 9.00
€ 3,132
€ 100
0
12
0
3
5
Petrol Station
1,400
€ 2.01
€ 2,813
€ 10
0
24
0
3
10
Retail
704
€ 9.00
€ 6,336
€ 100
0
12
0
3
5
25%
8 Deichmann SE
Retail
452
€ 9.00
€ 4,068
€ 100
0
12
0
3
5
25%
Retail
309
€ 6.00
€ 1,854
€ 100
0
12
0
3
5
25%
Retail
335
€ 0.00
€0
€0
0
0
0
3
5
25%
Retail
818
€ 5.00
€ 4,090
€ 100
0
12
0
3
5
25%
Other Units
6
€ 44.17
€ 265
€0
0
0
0
3
5
0%
Retail
84
€ 10.00
€ 840
€ 100
12
12
0
3
5
100%
External parking
500
€ 0.00
€0
€0
0
15
0
0
10
100%
13 VACANT
14 External Parking
Total
* months
11,630 sqm
** years
0%
€ 72,454
Page 7 of 12
.
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
10,230
0
0
0
0
0
10,230
1,400
6
0
500
1,906
Area Vacant
m²
0
84
0
0
0
0
0
84
0
0
0
0
0
Area Let
m²
0
10,146
0
0
0
0
0
10,146
1,400
6
0
500
500
Vacancy Rate
%
0.00%
0.82%
0.00%
0.00%
0.00%
0.00%
0.00%
0.82%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
6.84
0.00
0.00
0.00
0.00
0.00
2.01
44.17
7.14
0.00
0.00
Contractual
Rent
€/month
0
69,355
0
0
0
0
0
2,813
265
72,433
0
0
Contractual
Rent
€/year
0
832,256
0
0
0
0
0
33,756
3,180
869,192
0
0
Potential
Rent
€/year
0
839,092
0
0
0
0
0
33,756
3,180
876,028
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
6.78
0.00
0.00
0.00
0.00
0.00
2.01
44.17
7.08
0.00
0.00
Market
Rent
€/year
0
832,516
0
0
0
0
0
33,756
3,180
869,452
0
0
Market
Rent
€/month
0
69,376
0
0
0
0
0
2,813
265
72,454
0
0
Over-/ UnderRented
0.0%
0.8%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.8%
0.0%
0.0%
Space productivity
7,000
10.00
6,500
9.00
Explanation
8.00
5,500
7.00
Rent / m² / month
6,000
5,000
4,500
9.03
Market rent
Contractual Rent
Rents
6.00
6.00
5.22
5.00
4.51
4,000
4.00
3,500
Contractual
2.3%
5.22
Market
2.7%
6.00
4% of turnover
9.03
3% of turnover
6.77
3.00
in € / m² p.a.
14,050,009 €
(net)
Sales Area
2.00
1.0%
4.51
2% of turnover
Turnover potential
3,639
3,000
€ / m²
%
6.77
1.5%
based on sales area
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 3,861 m²
5,187 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
Kaufland Warenhandel GmbH & Co. KG
€ 324,823
37%
13.7 years
65
4A 2
2
78
€ 320,000 (single) € 18,600,000 (total)
the Schwarz Beteiligungs-KG, one of the biggest grocer groups in Europe. Kaufland is the self-service
GmbH & Co. KG has an below-average credit risk. The risk of insolvency (D&B Score) within the next 12
months compared with other German companies is assessed to be low, i.e. 78% of businesses on the
German database have the same or higher risk of failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
12
Market Value
The property is let to eight retail units and a petrol station. Currently, one small retail unit (84m²) is vacant. The WALT of the property amounts to 9.5 years. The main tenant is Kaufland with a share of approx. 40%
of the rental income. The property is currently almost let at market rental level. The main tenant Kaufland is almost let at market rental level. As the lease contract is valid until 2027 and the tenant has options until
2037. However, we are not of the opinion that the rental level can be adjusted before 2037. Kaufland’s rent is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in
relation to the CPI basis. The majority of the tenants does not pay costs for ground tax, insurance and for management. Except of the tenant KiK and the petrol station these costs will not be borne by the tenants.
Maintenance costs for structural repairs are borne by the landlord.
The lease of Deichmann, Fressnapf and a petrol station have been prolonged by further 4 and 5 years respectively. The existing area of the fashion retailer KiK were extended by 200 m². The lease for the new area
started in October 2013, with a net rent of € 10/m² and tenant improvements of € 70,000 (€ 350/m²). In this context, the general lease with KiK was prolonged by 12 years, until July 2025.
Discount rate
6.75%
Capitalisation rate
6.50%
reinsurance, the initial yields profile is aligned with the market/other transactions.
We have taken into account such facts as the stable Cash Flow, the good location, the short WALT, the
low vacancy rate and the good condition of the subject property in Vilshofen.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 4.50 /m²
€ 1.27 /m²
€ 2.71 /m²
€ 0.28 /m²
€ 0.00 /m²
€ 8.76 /m²
€ 46,033
€ 13,038
€ 27,671
€ 2,858
€0
€ 89,600
per year
per year
€ 4.50 /m²
€ 1.27 /m²
€ 2.71 /m²
€ 0.28 /m²
€ 0.00 /m²
€ 8.76 /m²
€ 46,033
€ 13,042
€ 27,671
€ 2,858
€0
€ 89,604
Inflation
% of Gross
Contract Rent
5.30%
1.50%
3.18%
0.33%
0.00%
10.31%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
5.29%
1.50%
3.18%
0.33%
0.00%
10.31%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 46,035
€ 46,772
€ 47,604
€ 48,442
€ 49,227
€ 50,005
€ 50,805
€ 51,628
€ 52,443
€ 53,220
€ 53,997
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 12,495
€ 12,996
€ 13,189
€ 13,223
€ 12,354
€ 12,327
€ 13,004
€ 13,223
€ 13,223
€ 12,697
€ 12,842
Insurance
Costs
€ 2,858
€ 2,904
€ 2,956
€ 3,008
€ 3,056
€ 3,105
€ 3,154
€ 3,205
€ 3,256
€ 3,304
€ 3,353
Ground
Tax
€ 27,671
€ 28,114
€ 28,614
€ 29,118
€ 29,589
€ 30,057
€ 30,538
€ 31,033
€ 31,523
€ 31,989
€ 32,457
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 92,419
€ 92,864
€ 92,363
€ 93,791
€ 98,144
€ 99,176
€ 99,758
€ 99,089
€ 100,445
€ 105,446
€ 106,625
Vacancy
Costs
€ 3,360
€ 2,078
€0
€0
€ 3,918
€ 3,682
€ 2,257
€0
€0
€ 4,236
€ 3,976
% of Total
Gross Revenue
11.1%
10.7%
10.5%
10.6%
11.9%
12.1%
11.5%
11.2%
11.4%
12.5%
12.5%
14.0%
11.9%
12.0%
11.1%
10.7%
10.5%
12.5%
12.1%
11.5%
11.2%
11.4%
10.6%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Cash Flow
12
Market Value
Rental
Revenue
€ 870,317
€ 878,879
€ 879,282
€ 881,543
€ 862,919
€ 861,566
€ 880,451
€ 881,527
€ 881,527
€ 888,970
€ 899,065
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
-€ 37,295
-€ 12,467
€0
€0
-€ 39,332
-€ 39,770
-€ 13,542
€0
€0
-€ 42,522
-€ 42,945
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 833,022
€ 866,412
€ 879,282
€ 881,543
€ 823,587
€ 821,796
€ 866,909
€ 881,527
€ 881,527
€ 846,448
€ 856,120
Nonrecoverable
Costs
-€ 92,419
-€ 92,864
-€ 92,363
-€ 93,791
-€ 98,144
-€ 99,176
-€ 99,758
-€ 99,089
-€ 100,445
-€ 105,446
-€ 106,625
Net
Operating
Income
€ 740,603
€ 773,548
€ 786,919
€ 787,752
€ 725,443
€ 722,620
€ 767,151
€ 782,438
€ 781,082
€ 741,002
€ 749,495
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
-€ 95,199
-€ 6,804
€ 638,600
-€ 20,779
-€ 5,677
€ 747,092
€0
€0
€ 786,919
€ 787,752
€0
€0
-€ 39,176
€ 676,434
-€ 9,833
-€ 9,942
-€ 36,824
€ 675,854
-€ 3,386
€ 741,194
-€ 22,571
€ 782,438
€0
€0
€0
€0
€ 781,082
-€ 42,353
-€ 10,630
€ 688,019
€ 12,097,955
-€ 10,736
-€ 39,764
Present
Value @
6.75%
€ 617,325
€ 678,636
€ 670,299
€ 628,561
€ 505,180
€ 473,537
€ 486,132
€ 480,784
€ 449,602
€ 371,401
€ 6,295,542
€ 11,656,999
€0
€ 11,656,999
8.0%
€ 1000000.0
€ 900000.0
6.4%
6.6%
6.8%
6.8%
€ 800000.0
6.7%
6.6%
6.2%
7.0%
6.7%
6.4%
6.2%
6.0%
5.0%
€ 600000.0
4.0%
€ 500000.0
€ 400000.0
Running yield
Rental income
€ 700000.0
3.0%
€ 300000.0
2.0%
€ 200000.0
1.0%
€ 100000.0
€ .0
Year 1
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 869,192
€ 7.08
Market rental value
total p.a.
per m²/month
€ 869,452
€ 7.08
1.14%
Over-/Underrent
Year 8
Total
€ 11,700,000
per m²
€ 1,144
Purchaser's costs
5.00%
Yield Overview
Net Initial Yield
6.66%
6.67%
Gross Initial Yield
7.83%
7.83%
Total
€ 11,100,000
per m²
€ 1,085
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 29 January 2014, the main tenant, Handelshof SB Warenhaus GmbH & Co. KG, has good
covenant strength, which ensures a secure cash flow for the remainder of the lease term until at least 2027. In terms of a resale, we took into account such facts as visibility, demographic factors, appearance,
condition and building age, third-party usability, competition situation and location.
assumed that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 4.50/m² per annum. Regarding
comparable rents, we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the section
"Investment Comparables".
The following changes occurred in comparison to previous valuation: The WALT increased to 9.5 years. According to the information provided to us the vacancy rate decreased by 2% to 0.8%. The existing area of
the fashion retailer KiK were extended by 200 m² (former vacant). The lease for the new area started in October 2013, with a net rent of € 10/m² and tenant improvements of € 70,000 (€ 350/m²). In this context, the
general lease with KiK was prolonged by 12 years, until July 2025. The lease of the tenants Deichmann, Fressnapf and a petrol station have been prolonged by further 4 and 5 years respectively.
Page 10 of 12
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Photos
View of the retail warehouses
Internal view of the tenant Kaufland
Internal view of the tenant Charles Vögele
Internal view of the vacant unit
Page 11 of 12
abc
Property address
Property no.
12
Portfolio:
Matrix Portfolio
Hösamer Feld 7
Valuation date:
31.12.2013
94474 Vilshofen
Inspection date:
01.02.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Real
Kaufland
Real
dm-drogerie markt
Charles Vögele
AWG Mode
Deichmann
0
City
Amberg
Hameln
Würzburg
Bentwisch
Traunreut
Volkach
Karlstadt
0
Property Type
Drugstore
Fashion
Fashion
Shoe store
0
Area
10,824 m²
4,426 m²
8,450 m²
790 m²
910 m²
1,000 m²
467 m²
0 m²
Total Rent p.m.
€ 71,114
€ 29,698
€ 61,685
€ 7,592
€ 7,680
€ 8,900
€ 4,651
€0
Rent p. sqm
€ 6.57 /m²
€ 6.71 /m²
€ 7.30 /m²
€ 9.61 /m²
€ 8.44 /m²
€ 8.90 /m²
€ 9.96 /m²
€ 0.00 /m²
Comment
Higher purchasing power
Similar out-of-town location, similar purchasing power
Better location, similar purchasing power
Similar purchasing power, other federal state
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
13
Property Summary
Key Figures
Property type
Main tenant
Retail Park
Total lettable area
Total parking units
8,691 m²
400 units
0.0%
9.9 years
1996
n.a.
total p.a.
per m² / month
€ 620,708
€ 5.95
total p.a.
per m² / month
€ 75,704
€ 0.73
total p.a.
per m² / month
€ 545,004
€ 5.23
total p.a.
€ 591,881
4.9%
Market rental value
SWOT Analysis
Strengths
Weaknesses
Good visibility and accessibility
Located close to a DIY store generating synergies
Petrol station on site
Long term lease contract of the main tenant Kaufland
Outdated architectural design
Strong competition
0
0
0
Opportunities
Threats
Extension of the lease contract after expiration date
Growing importance of the commercial area
0
0
0
Long-term vacancy if Kaufland vacates the property
0
0
Building
Location
Building age
Lettable Area
Property condition
General impression
2
2
3
3
16 to 25 years
Macrolocation
Microlocation
Commercial activity
Competition
Liquidity
2
2
3
2
Below average micro location
Investment Quality
WALT
Over- / underrent
Quality of tenants
Investment market
Investment volume
Saleability
3 Reasonable lot size
The subject property is a one- to two-storey department store. The property was built in 1996 and faces Wahrenberger Straße and Cumloser Straße. The property has one main entrance from the parking space in
front of the building and a separate entrance to the unit rented by the tenant Hammer, as well as from the parking area. The building has an L-shape and is made of a steel reinforced concrete construction with
precast parts. The property has got a flat roof with galvanised steel sheets.
Valuation Results
Market Value
€ 7,400,000
equals to
Market Rental Value
€ 851 per m²
€ 591,881 p.a.
Discount Rate
7.50%
Net Initial Yield
6.90%
Capitalisation Rate
7.00%
6.54%
excluding
capital
expenditures
Page 1 of 12
€ 5.68 / m² / p.m.
equals to
6.90%
11.92
6.54%
12.50
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Location
Germany
Brandenburg
Prignitz (Rural District)
Wittenberge
19322
Federal State
District
City
Postcode
Population
Population
Population
Population Density
Population Density
Federal State
District
City
City
District
City
District
Federal State
District
Federal State
District
absolute
absolute
absolute
absolute
per km²
per km²
in %
in %
in %
in %
in %
Structual Data
Purchasing Power
Purchasing Power
Wittenberge
2,495,635
80,872
18,278
10,526
38
362
-19.9%
-2.2%
-7.5%
9.6%
12.4%
District
City
Federal State
District
District
in m €
in m €
index
index
index
1,351
291
88.50
77.09
95.30
Macro Location
Wittenberge is situated in the federal state of Brandenburg in the administrative region of Prignitz. The
city covers an area of 50.44 km². Nearby cities include Berlin (120 km), Potsdam (100 km) and
Lüneburg (80 km). The A24 federal motorway is located 35 km to the north and the B89 offers a direct
connection to the motorway.
The city’s train station is linked to the ICE network. Wittenberge is a stop on the route from Hamburg to
Berlin. International connections to Prague and Kopenhagen are also available.
The closest passenger airport is located in Berlin, which can be reached within 120 km.
The economy of Wittenberge is primarily characterised by small- and mid-sized companies. Moreover,
agriculture is a major part of Wittenberge’s economy.
Micro Location
Micro Location
The property is located slightly outside of the western outskirts of Wittenberge, very close to the federal
road B189, which connects Wittenberege with the motorway system. The property is located along an
aterial road connecting western Wittenberge with the B189. Next to the subject property, there is a DIY
store operated by OBI and apart from that, there are only few residential dwellings to the north-east as
well as agricultural land in the surrounding area.
0
Land Transfer Tax
Page 2 of 12
City
City
in %
in %
abc
400
5.0
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Site Plan
Source: Cadastral plan on a 1 to 1,000 scale, dated 29th December 2010
Site Information
Site area
39,690 m²
0 m²
Ground lease
No
n.a.
Ground lease expiry
n.a.
€0
Site servicing
Fully serviced
Irregular
Site layout
Soil contamination
No Suspicion
No
Comment
The property has an even topography and irregular shape. It is accessible from the east. According to
information provided by the city of Wittenberge, the site is not registered in the register of contaminated
sites.
In Brandenburg, there are no building encumbrances. Instead the muncipalities obtain personal
easments, which are registered in the land register in divison II. Thus, we assumed the subject property
to be free of any building encumbrances.
Town Planning
Use class
SO (special zone)
0.8
Plot ratio (GFZ)
0.5
Cubic index (BMZ)
n.a.
Comment
entitled "Nr. 2 Geschäftshauskomplex Wahrenberger Straße / B 189" and dated 04.03.1993, with the
following regulations: the subject site is located in a special zone (SO). The site coverage ratio is limited
to 0.8 and the plot ratio to 0.5.
Tenure
Land Register
Owner
TPL Wittenberge
Local Court of
Perleberg, land register S.á.r.l., Luxembourg
of Wittenberge
Sheet
5509
Plot
28
Parcel
155/4
159/9
Limited personal easement to operate a selfservice department store on the plot in favour of
Kaufland Stiftung & Co. KG, Neckarsulm.
Section 3 (Loans)
Page 3 of 12
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Competitor Map
Competitor Overview
Name
E-Center
0
0
Type
Hypermarket
Address
19322 Wittenberge, Lenzener Chaussee 21
Sales area
3,255 m²
m²
m²
Distance
1.00 km
Potential
High
0
0
0
0
0
0
0
0
0
0
0
16,357
1,351
7,309
16,261
9,196
12.4%
3,975
77.09
Page 4 of 12
-19.9%
95.30
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
13
Main competitors
This competitor is a new retail park with a large EDEKA centre as anchor tenant. The sales area of
Edeka is about 3,500 m². Within this retail park, there are several well-known tenants such as ALDI,
Charles Vögele, and even a toom DIY store, which is another anchor tenant. This centre is newer
and has a slightly better location also near the B189.
Charles Vögele contributes to the tenant mix surrounding the EDEKA centre. This is the only large
competitor, which has a similar tenant mix and size compared to the subject property, and is considered
superior when compared to the subject site.
Competition Comment
Approximately 19,000 inhabitants live in the secondary catchment area. Two self-service department stores are present within this area, which correlates to approx. 9,500 inhabitants (i.e. potential customers per
self-service department store). Within the broader tertiary catchment area, there is still only one competitor for the 27,000 inhabitants, which increases the customer potential in this rural area to 13,500 potential
customers per self-service department store.
We consider the EDEKA centre located close by in a retail park to be the main competitor and superior to the subject property. Located only 1.2 km from the subject property also at the B189, they share almost
exactly the same catchment area. As both properties need to be accessed by car, we think that most customers will prefer the retail park to the subject property due to its newer construction date and good tenant
mix.
Apart from the EDEKA centre, only small supermarkets or discounters compete for the non-food customers. However, we still assess the level of competition to be rather high and that the EDEKA centre will draw
more than average customer potential from the subject property.
0
Turnover analysis
The rents in functional retail agglomerations are linked to the achievable turnover. The percentage rate that a retail tenant can use for rental payments depends on the margins achievable in the various market
sectors. This rate normally ranges between 2% and 15% depending on the respective industry. The productivity varies between approx. € 1,000/m² and up to more than € 10,000/m².
For Kaufland, we have also been provided with turnover figures for the previous valuation. We have analysed the figures and have found the area productivity of Kaufland to be in a healthy range. With a turnoverto-rent ratio of less than 2% it lies below the range of 2% to 4%, which is acceptable for a self-service department store. However, we believe that a slightly lower market rent is achievable after the end of the lease
contract.
According to Trade Dimension, the turnover potential of the Kaufland is € 16,200,000 p.a. (net basis) . This results in a space productivity of approx. € 4,050 m². The rents hypermarkets usually pay are in the range
of 2% to 4%, depending on location and quality of the building. Kaufland’s turnover-rent ratio generally lies above the threshold of 2% but below 4%. Therefore, we consider the rent paid to be sustainable in the
long run.
Conclusion
The subject property is a self-service department store situated in an average location within Wittenberge. The depth and breadth of the product range is very good. However, the property faces tough competition
from a newer retail park with EDEKA as anchor tenant. The rental area of Kaufland can be regarded as relatively unproblematic. In the unlikely case that Kaufland should vacate the premises, the property could be
re-let to an other self-service department stores as real or Marktkauf.
We assumed that the tenant Kaufland will prolong the contract until 2037 due to the low contractual rental level. However, the market rental level is similar. More problematic would be Hammer vacating the
property, as there are only few potential tenants for such rental unit. The most probable alternative use tenant for this unit would be a furniture store. Although this property will face some problems due to the
competition, we are of the opinion that the location to be sustainable on the low rental level, which is currently paid at the property.
0
Page 5 of 12
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Rent Roll
Tenant Name
2 Hammer Fachmärkte für Heimausstattung GmbH & Co. KG
4 Kurzzeitmieter
5 Parking Spaces
Area Category
Letting
Status
Area
m² / unit
Rent
/ month
Rent / m²
/ month
Tenant
pays VAT
Lease
Start
Lease
End
Renewal
Probability
Retail
Let
6,117
€ 32,208
5.27
Yes
01.10.2007
30.09.2026
Retail
Let
2,574
€ 15,830
6.15
Yes
01.06.2007
28.02.2019
75%
Other Units
Let
9
€ 488
54.17
No
01.01.2010
31.12.2014
100%
100%
75%
Other Units
Let
1
€ 1,035
1035.00
Yes
01.10.2007
30.09.2026
External parking
Let
400
€0
0.00
No
01.10.2007
30.09.2026
100%
Petrol Station
Let
1,020
€ 2,164
2.12
Yes
07.04.2003
06.04.2018
100%
9,711 m²
€ 51,726
Total
Tenant
pays *
M GT I
Page 6 of 12
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Tenant Name
Area Category
Area
sqm/unit
Retail
6,117
Market
Rent
Market
Rent /month
Re-letting
Re-letting
Initial
Tis
Void VPV*
Void*
Rent
Abatem.*
Agency
Fees*
Lease
Term**
3
Renewal
Probability
€ 5.00
€ 30,585
€ 50
0
12
0
10
25%
Retail
2,574
€ 6.25
€ 16,086
€ 50
0
18
0
3
10
25%
Other Units
9
€ 54.17
€ 488
€0
0
6
0
3
10
0%
4 Kurzzeitmieter
Other Units
1
€ 0.00
€0
€0
0
6
0
0
10
0%
External parking
400
€ 0.00
€0
€0
0
12
0
0
10
0%
Petrol Station
1,020
€ 2.12
€ 2,164
€0
0
6
0
3
10
0%
2 Hammer Fachmärkte für Heimausstattung GmbH & Co. KG
5 Parking Spaces
Total
* months
9,711 sqm
** years
€ 49,323
Page 7 of 12
.
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Property Analysis
Area Analysis
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Total area
Petrol Station
Other Units
Internal parking
External parking
Total parking
Lettable Area
m²
0
8,691
0
0
0
0
0
8,691
1,020
10
0
400
1,430
Area Vacant
m²
0
0
0
0
0
0
0
0
0
0
0
0
0
Area Let
m²
0
8,691
0
0
0
0
0
8,691
1,020
10
0
400
400
Vacancy Rate
%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Income Analysis
Contractual
Rent
€/m²/month
0.00
5.53
0.00
0.00
0.00
0.00
0.00
2.12
152.25
5.95
0.00
0.00
Contractual
Rent
€/month
0
48,039
0
0
0
0
0
2,164
1,523
51,726
0
0
Contractual
Rent
€/year
0
576,466
0
0
0
0
0
25,972
18,270
620,708
0
0
Potential
Rent
€/year
0
576,466
0
0
0
0
0
25,972
18,270
620,708
0
0
Use Category
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Petrol Station
Other Units
Total area
Internal parking
External parking
Office
Retail
DIY
Warehouse
Commercial
Residential
Storage
Market
Rent
€/m²/month
0.00
5.37
0.00
0.00
0.00
0.00
0.00
2.12
48.75
5.68
0.00
0.00
Market
Rent
€/year
0
560,059
0
0
0
0
0
25,972
5,850
591,881
0
0
Market
Rent
€/month
0
46,672
0
0
0
0
0
2,164
488
49,323
0
0
Over-/ UnderRented
0.0%
2.9%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
212.3%
4.9%
0.0%
0.0%
Space productivity
7,000
10.00
6,500
9.00
Explanation
8.00
5,500
7.00
Rent / m² / month
6,000
5,000
4,500
8.80
Market rent
Contractual Rent
Rents
6.60
6.00
5.27
5.00
5.00
4.40
4,000
4.00
2.4%
5.27
Market
2.3%
5.00
4% of turnover
8.80
3% of turnover
6.60
Turnover potential
3.00
2.00
1.0%
in € / m² p.a.
16,157,982 €
(net)
Sales Area
3,000
4.40
2% of turnover
4,053
3,500
€ / m²
%
Contractual
1.5%
2.0%
based on sales area
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
Total Area
~ 3,987 m²
6,117 m²
Turnover-rent-ratio
Main tenant
Tenant name
Rent p.a.
WALT
Payment Index
Capital indicator
Risk indicator
Score
Credit limit
Comment
€ 386,501
62%
12.7 years
80
3AA 2
2
83
€ 66,000 (single) € 840,000 (total)
Schwarz Beteiligungs-KG, one of the biggest grocer groups in Europe. Kaufland is the self-service
Brandenburg GmbH & Co. KG has a low credit risk. The risk of insolvency (D&B Score) within the next
12 months compared with other German companies is assessed to be low, i.e. 83% of businesses on
the German database have the same or higher risk of failure.
Page 8 of 12
abc
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Property address
Property no.
Assumptions
13
Market Value
The property is fully let to two retail tenants and a petrol station. The WALT of the property amounts to 9.9 years. The main tenant is Kaufland with a share of approx. 63% of the rental income. The property is
currently slightly overrented due to the property age and location. The rent of Kaufland is indexed and will be adapted by 50% of the CPI change, whenever the change exceeds 10 percent in relation to the CPI
basis. The tenants do not pay ground tax, insurance costs, maintenance, or property management with the exception of the petrol station, where the tenant pays everything with the exception of property
management.
0
Discount rate
7.50%
Capitalisation rate
7.00%
account such facts as the stable Cash Flow, the long lease contract with the tenant Kaufland, the full
occupancy and the good condition of the subject property in Wittenberge.
€0
Vacancy costs
€ 10.00 /m²/p.a.
Contract**
(month 1 x 12)
Maintenance costs
Management costs
Ground tax
Insurance costs
** JLL analysis
Market
Maintenance costs
Management costs
Ground tax
Insurance costs
per year
per year
€ 5.50 /m²
€ 1.07 /m²
€ 1.85 /m²
€ 0.29 /m²
€ 0.00 /m²
€ 8.71 /m²
€ 47,800
€ 9,311
€ 16,064
€ 2,530
€0
€ 75,704
per year
per year
€ 5.50 /m²
€ 1.02 /m²
€ 1.85 /m²
€ 0.29 /m²
€ 0.00 /m²
€ 8.66 /m²
€ 47,800
€ 8,878
€ 16,064
€ 2,530
€0
€ 75,272
Inflation
% of Gross
Contract Rent
7.70%
1.50%
2.59%
0.41%
0.00%
12.20%
Year
Inflation
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
2021
1.4%
2022
1.4%
after 2022
1.6%
2021
1.4%
2022
1.4%
after 2022
1.6%
Year
Rental Growth
% of Gross
Market Rent
8.08%
1.50%
2.71%
0.43%
0.00%
12.72%
2013 2014 2015 2016 2017 2018 2019 2020
1.0% 1.5% 1.5% 1.5% 1.4% 1.3% 1.4% 1.4%
Market
Contract
Maintenance costs
Management costs
Ground tax
Insurance costs
Maintanance
Costs
€ 47,800
€ 48,565
€ 49,429
€ 50,299
€ 51,114
€ 51,921
€ 52,752
€ 53,607
€ 54,454
€ 55,260
€ 56,066
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Management
Costs
€ 9,362
€ 9,362
€ 9,600
€ 9,648
€ 9,648
€ 8,395
€ 9,951
€ 9,959
€ 9,959
€ 9,959
€ 9,977
Insurance
Costs
€ 2,530
€ 2,570
€ 2,616
€ 2,662
€ 2,705
€ 2,748
€ 2,792
€ 2,837
€ 2,882
€ 2,925
€ 2,967
Ground
Tax
€ 16,064
€ 16,321
€ 16,612
€ 16,904
€ 17,178
€ 17,449
€ 17,728
€ 18,016
€ 18,300
€ 18,571
€ 18,842
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
0€
Total
per year
€ 75,756
€ 76,818
€ 78,257
€ 79,513
€ 80,645
€ 92,162
€ 83,223
€ 84,419
€ 85,595
€ 86,715
€ 87,852
Vacancy
Costs
€0
€0
€0
€0
€0
€ 11,649
€0
€0
€0
€0
€0
% of Total
Gross Revenue
12.1%
12.3%
12.2%
12.4%
12.5%
16.5%
12.5%
12.7%
12.9%
13.1%
13.2%
18.0%
16.5%
16.0%
14.0%
12.1%
12.3%
12.2%
12.4%
12.5%
12.5%
12.7%
12.9%
13.1%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Page 9 of 12
abc
Property address
Property no.
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Cash Flow
13
Market Value
Rental
Revenue
€ 624,158
€ 624,158
€ 640,030
€ 643,204
€ 643,204
€ 647,002
€ 663,417
€ 663,907
€ 663,907
€ 663,907
€ 665,141
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Turnover
Vacancy
€0
€0
€0
€0
€0
-€ 87,367
€0
€0
€0
€0
€0
Rent
Abatements
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
€0
Total
Gross
Revenue
€ 624,158
€ 624,158
€ 640,030
€ 643,204
€ 643,204
€ 559,635
€ 663,417
€ 663,907
€ 663,907
€ 663,907
€ 665,141
Nonrecoverable
Costs
-€ 75,756
-€ 76,818
-€ 78,257
-€ 79,513
-€ 80,645
-€ 92,162
-€ 83,223
-€ 84,419
-€ 85,595
-€ 86,715
-€ 87,852
Net
Operating
Income
€ 548,402
€ 547,340
€ 561,773
€ 563,691
€ 562,559
€ 467,473
€ 580,194
€ 579,488
€ 578,312
€ 577,192
€ 577,289
TIs and
Leasing
Capital
Commissions
Cash Flow
Expenditures
€0
€0
€ 548,402
€0
€0
€ 547,340
€0
€0
€ 561,773
€ 563,691
€0
€0
€0
€ 562,559
€0
-€ 13,105
-€ 34,947
€ 419,421
€0
€ 580,194
€0
€ 579,488
€0
€0
€0
€0
€ 578,312
€0
€0
€ 577,192
€ 8,246,971
€0
€0
Present
Value @
7.50%
€ 530,637
€ 492,660
€ 470,293
€ 439,050
€ 407,599
€ 282,333
€ 363,763
€ 337,975
€ 313,756
€ 291,302
€ 4,001,380
€ 7,930,748
€0
€ 7,930,748
8.0%
€ 700000.0
6.9%
6.9%
7.1%
7.1%
7.3%
7.1%
7.3%
7.3%
7.3%
7.0%
€ 600000.0
5.9%
6.0%
5.0%
€ 400000.0
4.0%
€ 300000.0
Running yield
Rental income
€ 500000.0
3.0%
€ 200000.0
2.0%
€ 100000.0
€ .0
Year 1
1.0%
Year 2
Year 3
Year 4
Year 5
Valuation Results
Year 6
Year 7
Year 8
Year 9
0.0%
Year 10
Market Value
Rent Overview
total p.a.
per m²/month
€ 620,708
€ 5.95
Market rental value
total p.a.
per m²/month
€ 591,881
€ 5.68
4.87%
Over-/Underrent
Total
€ 7,900,000
per m²
€ 909
Purchaser's costs
6.75%
Yield Overview
Net Initial Yield
6.90%
6.54%
Gross Initial Yield
8.39%
8.00%
Total
€ 7,400,000
per m²
€ 851
Valuation Comment
In terms of risk, we considered the covenant strength as well as the lease duration for the existing contracts. As at 29 January 2014, the main tenant, Kaufland Dienstleistung GmbH & Co. KG, has good covenant
strength, which ensures a secure cash flow for the remainder of the lease term. The rent of the petrol station tenant has slightly increased, due to higher revenues of the last period on which the rent is based. In
terms of a resale, we took into account such facts as visibility, demographic factors, appearance, condition and building age, third-party usability, competition situation and location.
assumed that all capital expenditures for repairs in the first year as well as in the periods of year 2 to 5 and year 6 to 10 are considered to be covered by the maintenance costs of € 5.50/m² per annum as sinking
fund.
Regarding comparable rents, we have had recourse to evidence of similar areas situated in the comparable regions and locations. Furthermore, we have analysed comparable transactions. Please refer to the
section "Investment Comparables".
No significant changes occurred in comparison to previous valuation.
Page 10 of 12
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Photos
View of the main entrance of Kaufland
View of the main entrance of Hammer
View of the parking space
Internal view of Kaufland
Page 11 of 12
abc
Property address
Property no.
13
Portfolio:
Matrix Portfolio
Valuation date:
31.12.2013
19322 Wittenberge
Inspection date:
31.01.2011
Germany
Prepared for:
Leasing Market
Investment Market
Leasing Comparables
Tenant
Real
Real
Real
Kaufland
EDEKA
Sport Store
Local chain
0
City
Lübbenau
Verden (Aller)
Braunschweig
Crimmitschau
Zwickau
Leipzig
Leipzig
0
Property Type
Large scale sport store
Furniture Store
0
Area
1,800 m²
2,750 m²
19,688 m²
4,661 m²
1,300 m²
2,600 m²
3,800 m²
0 m²
Total Rent p.m.
€ 8,136
€ 13,118
€ 104,150
€ 21,441
€ 7,956
€ 17,004
€ 21,546
€0
Rent p. sqm
€ 4.52 /m²
€ 4.77 /m²
€ 5.29 /m²
€ 4.60 /m²
€ 6.12 /m²
€ 6.54 /m²
€ 5.67 /m²
€ 0.00 /m²
Comment
Same federal state; similar purchasing power
Other federal state; similar purchasing power
0
Property Type
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
Hypermarket
0
Year of
Construction
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
0
Area
8,520 m²
13,000 m²
22,926 m²
13,000 m²
2,269 m²
13,000 m²
10,031 m²
0 m²
Gross
Multiplier
14.1-fold
13.8-fold
8.0-fold
15.3-fold
14.7-fold
13.8-fold
10.1-fold
0.0-fold
Date of
Transaction
Q3 2013
Q2 2012
2012
2012
2012
Q2 2012
2012
0
Comment
0
Page 12 of 12
abc
Appendix II – Overview
Appendix II – Overview
abc
Matrix Portfolio Valuation Overview
Property Information
No
Town
Address
General Data
Use
Year of
Construction /
Modernisation
Plot Size
Lettable
Area
Vacancy
Rate
Rental Income
Weigted Average
Lease Term
Contractual
Rental Income
Contract Rent
Net
Operating Income
Yields / Multiplier
Non-recoverable Costs
Market Rental Value
Market
Rent
Over/under-rent
Maintenance
Costs
Management
Costs
Ground Tax
Insurance
Costs
Other Costs*
Total nonrecs
Total nonrecs
Total nonrecs
Surplus Land
Value
Capital
Expenditures
(year 1)
Capitalisation
Rate
Discount
Rate
Multiplier
Multiplier
Values
Gross
Initial Yield
Net
Initial
Yield
Net
Reversionary
Yield
Gross Capital
Value
Purchaser's
Costs
Market Value after
Capex
Market
Value
(MARKET)
relative
m²
m²
%
years
€ p.a.
€/m²/month
€ p.a.
€ p.a.
€/m²/month
%
€/m²
%
€/m²
€/m²
€/m²
€/year
€/m²/year
% of income
€
€
%
%
1
1
Aschersleben
Hoymer Chaussee 108
Retail Park
1993 / n.a.
36,735
14,522
8.83%
7.9
1,520,129
8.72
1,397,972
1,595,689
9.16
4.48%
5.50
1.50
1.01
0.33
0.00
122,157
8.41
8%
0
0
7.10
7.65
%
%
%
€
%
€
€/m²
13.16
12.53
7.60%
6.56%
6.91%
21,300,000
6.50%
20,000,000
1,377
2
2
Augsburg
Retail Park
1969 / 1995
20,862
13,770
19.41%
6.2
1,203,705
7.28
1,044,978
1,487,432
9.00
-8.78%
5.50
1.50
4.41
0.31
0.00
158,727
11.53
13%
0
0
6.75
3
3
Bad Aibling
Retail Park
2000 / n.a.
19,222
7,053
0.00%
4.1
636,025
7.52
562,378
695,930
8.22
-8.61%
5.50
1.50
3.30
0.28
0.00
73,647
10.44
12%
0
0
6.75
7.05
13.71
11.09
7.30%
6.04%
7.66%
17,300,000
5.00%
16,500,000
1,198
7.50
12.74
11.64
7.85%
6.62%
7.31%
8,500,000
5.25%
8,100,000
1,148
4
4
Biberach
Obere Stegwiesen 10
Retail Park
1994 / n.a.
26,342
10,769
0.00%
7.2
1,262,394
9.77
1,180,286
1,282,235
9.92
-1.55%
4.50
1.50
1.01
0.36
0.00
82,109
7.62
7%
229,800
0
6.75
7.10
12.36
5
5
Borken
Heidenerstraße 32
Retail Park
2003 / n.a.
17,337
9,524
0.84%
6.7
996,674
8.72
908,683
1,226,337
10.73
-13.26%
5.50
1.50
1.73
0.43
0.00
87,991
9.24
9%
0
0
6.50
7.15
14.85
12.17
8.09%
7.11%
7.23%
16,900,000
6.50%
15,800,000
1,449
12.07
6.73%
5.79%
7.23%
15,700,000
6.50%
14,800,000
6
6
Erlangen
Retail Park
1975 / 2004
17,609
13,398
7.15%
5.8
1,164,606
7.24
791,707
1,625,168
10.11
-23.17%
6.50
1.50
4.59
0.28
15.17
372,900
27.83
32%
0
0
6.50
7.00
10.90
1,554
7.81
9.17%
5.95%
9.36%
13,300,000
5.00%
12,700,000
7
7
Geislingen
Gartenstraße 30
Retail Park
2002 / n.a.
10,909
9,390
0.66%
7.0
640,469
5.68
551,943
835,732
7.42
-21.01%
4.50
1.50
3.49
0.41
0.00
88,526
9.43
14%
0
0
6.50
7.45
948
14.05
10.77
7.12%
5.75%
7.75%
9,600,000
6.75%
9,000,000
8
8
Glauchau
Retail Park
1992 / n.a.
47,878
12,767
0.13%
7.9
1,264,953
8.26
1,149,664
1,197,680
7.82
5.72%
5.50
1.50
1.75
0.29
0.00
115,288
9.03
9%
0
0
7.25
958
7.25
12.33
13.03
8.11%
7.01%
6.61%
16,400,000
5.00%
15,600,000
1,222
9
9
Ludwigsburg
Retail Park
1997 / n.a.
10,911
14,144
0.00%
7.9
1,013,225
5.97
879,386
1,332,505
7.85
-23.96%
4.75
1.50
3.26
0.37
0.00
133,838
9.46
13%
0
0
6.25
6.50
13.42
10.21
7.45%
6.06%
8.23%
14,500,000
6.50%
13,600,000
962
10
10
Ludwigsfelde
Retail Park
1997 / n.a.
10,340
12,632
0.00%
7.6
1,208,820
7.97
1,098,403
1,085,152
7.16
11.40%
5.50
1.50
1.40
0.40
0.00
110,417
8.74
9%
0
0
7.00
7.10
12.16
13.55
8.22%
7.00%
6.22%
15,700,000
6.50%
14,700,000
1,164
11
11
Neckarsulm
Retail Park
1974 / 2001
32,520
10,270
12.35%
3.8
1,381,692
11.21
1,271,734
1,276,200
10.36
14.10%
6.50
1.50
1.78
0.41
0.00
109,957
10.71
8%
441,600
0
7.00
7.50
11.87
12.85
8.42%
7.31%
6.71%
17,900,000
6.50%
16,800,000
1,597
12
12
Vilshofen
Hösamer Feld 7
Retail Park
1999 / 2007
37,515
10,230
0.82%
9.5
869,192
7.08
779,592
869,452
7.08
1.14%
4.50
1.50
2.71
0.28
0.00
89,600
8.76
10%
0
0
6.50
6.75
12.77
12.77
7.83%
6.66%
6.67%
11,700,000
5.00%
11,100,000
1,085
13
13
Wittenberge
Retail Park
1996 / n.a.
39,690
8,691
0.00%
9.9
620,708
5.95
545,004
591,881
5.68
4.87%
5.50
1.50
1.85
0.29
0.00
75,704
8.71
12%
0
0
7.00
7.50
11.92
12.50
8.39%
6.90%
6.54%
7,900,000
6.75%
7,400,000
851
4.37%
7.0
13,782,592
7.80
12,161,729
15,101,395
8.55
1.31
5.38
1.50
2.50
0.34
1.38
1,620,862
11.01
12%
12.78
11.66
7.8%
6.51%
7.22%
186,700,000
6.00%
176,100,000
1,197
*based upon market benchmarks
Valuation Date 31.12.2013
05.02.2014
327,870 147,160
0
abc
Appendix III – General Principles for Valuation
Appendix III –General Principles for
Valuation
General Principles Adopted in the Preparation of
Valuations and Reports
These are the general principles upon which our Valuations and Reports are normally prepared; they apply unless we have
specifically mentioned otherwise in the body of the report. Where appropriate, we will be pleased to discuss variations to
suit any particular circumstances, or to arrange for the execution of structural or site surveys, or any other more detailed
enquiries.
1
a)
Guidelines
RICS Appraisal and Valuation Manual
All work is carried out in accordance with the Practice Statements contained in the RICS Appraisal and Valuation Manual published
by the Royal Institution of Chartered Surveyors, by valuers who conform to the requirements thereof.
b)
International Valuation Standards (IVS)
The standards of the International Valuation Standards Council (IVSC) are in accordance with the definition and interpretation of the
Market Value as defined by the RICS and consistent with the concept of Fair Value as defined in the International Financial Reporting
Standards.
c)
Directive for Derivation of Market Value (German Immobilienwertermittlungsverordnung, “ImmoWertV“)
Appraisals of German Market Value (“Verkehrswert”) are prepared on the basis of the current version of the ImmoWertV. They are
conducted by RICS-approved personnel.
d)
Directive for Derivation of Mortgage Lending Value (German Beleihungswertermittlungsverordnung, “BelWertV“)
Appraisals of German Mortgage Lending Value (“Beleihungswert”) are prepared on the basis of the current version of the BelWertV.
They are conducted by personnel approved by the HypZert GmbH.
2
Valuation Basis
Our reports state the purpose of the valuation and the basis adopted. The following definitions are usually the basis of our valuation:
a)
Market Value (MV, RICS)
The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing
seller in an arm's-length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without
compulsion.
b)
Market Rent (RICS)
The estimated amount for which an interest in real property should be leased on the valuation date between a willing lessor and willing
lessee on appropriate lease terms in an arm’s length transaction, after proper marketing and where the parties had each acted
knowledgeably, prudently and without compulsion.
c)
Depreciated replacement cost (DRC, RICS)
The current cost of replacing an asset with its modern equivalent asset, less deductions for physical deterioration and all relevant forms
of obsolescence and optimisation.
d)
Fair Value (RICS)
The estimated price for the transfer of an asset or liability between identified knowledgeable and willing parties that reflects the
respective interests of those parties. (IVS 2013). This does not apply to valuations for financial reporting – see IVS 300.
The price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at
the measurement date. (IFRS 13)
e)
German Market Value (“Verkehrswert“ according to § 194 BauGB)
The Market Value (Verkehrswert) is determined by the price which could be achieved at the date of valuation in an arm’s length
transaction reflecting the legal and physical situation, location and other character of the property or other subject of valuation, without
consideration of unusual or personal interest.
f)
Mortgage Lending Value (“Beleihungswert” according to § 16 PfandBG)
The mortgage lending value (Beleihungswert) must not exceed the value resulting from a prudent assessment of the future
marketability of a property by taking into account the long-term sustainable aspects of the property, the normal regional market
condition as well as the current and possible alternative uses. Speculative elements must not be taken into consideration. The mortgage
lending value must not exceed a market value calculated in a transparent manner and in accordance with a recognized valuation
method.
g)
Plant & Machinery
An opinion of the price at which an interest in the Plant & Machinery utilized in a business would have been transferred at the date of
valuation assuming:
fa)
fb)
fc)
h)
that the Plant & Machinery will continue in its present use in the business;
adequate potential profitability of the business, or continuing viability of the undertaking, both having due regard to the value of
the total assets employed and the nature of the operation;
that the transfer is part of an arm’s length sale of the business wherein both parties acted knowledgeably, prudently and without
compulsion.
Financial Statements
Valuations for Financial Statements shall be in accordance with the IVSC International Valuation Application 1 (IVA 1).
i)
Lending
Valuations for lending purposes shall be in accordance with IVSC International Valuation Application 2 (IVA 2).
3
Source of Information
We have relied upon the information provided to us by yourselves as to details of tenure, tenancies, planning consents, site area,
accommodation, documents of title, cadastral plans, restrictions on title, and other relevant matters, as summarised in our report. We
do not accept any liability for either the accuracy or the completeness of this information. We are neither obliged to confirm the
completeness and correctness of the information provided nor to examine any original documentation for the same purpose.
4
Documentation
a)
We do not normally read leases or documents of title and, where these have been provided to us, we recommend that reliance should
not be placed on our interpretation thereof without verification by your lawyers.
b)
We assume, unless informed to the contrary, that each property has a good and marketable title, that all documentation is satisfactorily
drawn and that there are no encumbrances, restrictions, easements or other outgoings of an onerous nature, which would have an effect
on the value of the interest under consideration, nor material litigation pending.
5
Tenants
Although we reflect our general understanding of a tenant's status in our valuations, enquiries as to the financial standing of actual or
prospective tenants are not normally made unless specifically requested. Where properties are valued with the benefit of lettings, it is
therefore assumed, unless we are informed otherwise, that the tenants are capable of meeting their financial obligations under the lease
and that there are no arrears of rent or undisclosed breaches of covenant.
6
Town Planning and Other Statutory Regulations
a)
Unless informed to the contrary, our valuations are prepared on the basis that the premises (and any works thereto) comply with all
relevant statutory regulations, including enactments relating to fire regulations.
b)
Information on Town Planning is often obtained verbally from the Local Planning Authority and, if reassurance is required, we
recommend that legally binding written confirmation of the same is obtained.
7
Other Defects and Damages
a)
We normally assume that:
b)
aa)
the building and its technical facilities are free of damages and other defects.
bb)
the building was constructed or altered without using deleterious materials or techniques (including, by way of example, high
alumina cement concrete, wood wool as permanent shuttering, calcium chloride or asbestos).
cc)
the ground conditions are suitable and that, where development is contemplated, no extraordinary expenses or delays will be
incurred during the construction period due to these, or to archaeological or ecological matters.
dd)
the land is not contaminated.
Unless expressly instructed, we do not carry out a structural survey, nor do we test the services. Whilst any readily apparent defects or
items of disrepair, which we note during the course of our inspection, will be reflected in our valuations, we are not able to give any
assurance that any property is free from defect. We recommend the necessary surveys to be taken out in order to confirm our
assumptions in this respect.
c)
Unless expressly instructed we do not carry out technical surveys to ascertain whether those defects and damages exist, or have
occurred in the past. We are therefore not able to give any assurance that any property is free from damages or other defects. Any
readily apparent defects or items of disrepair, which we note during the course of our inspection, will be reflected in our valuation.
d)
Provided that we are informed about:

other defects and damages of the building and its technical facilities

the application of any such materials, as listed in lit. ab) above

unsuitable ground conditions as set out in lit. ac) above

any contamination of land as listed in lit. ad) above
by the client or any other party involved, such information will be reflected in our valuation, only if we are provided with reliable
estimates of costs for their replacement or compensation.
8
Value Added Tax (VAT)
Valuations are prepared and expressed exclusive of VAT payments, unless otherwise stated.
9
Outstanding Debts
In the case of buildings where works are in hand or have recently been completed, we do not normally make allowance for any
liability already incurred, but not yet discharged, in respect of completed works, or obligations in favour of contractors, subcontractors or any members of the professional or design team.
Standard Terms of Business
for Advisory Services
1
Scope
a)
These Standard Terms of Business are applicable for contracts regarding general advisory, valuation and/or market research services
between Jones Lang LaSalle GmbH (hereinafter also referred to as "Jones Lang LaSalle" or the "Advisor") and the client (hereinafter
also referred to as the "Client").
b)
The results of the work of the Advisor on the basis of this Agreement are intended exclusively for the Client and may only be used for
the purpose specified in the Agreement. The disclosure of the results of this work to third parties is generally prohibited.
2
Limitation and Execution of Contract
a)
Jones Lang LaSalle shall provide the agreed services, but shall not guarantee a particular economic result. Jones Lang LaSalle’s
services will be deemed as complete once the agreed analyses and the corresponding conclusions and, where applicable,
recommendations have been produced and presented to the Client or, in the event of an agreed expert-report or an agreed other written
statement, these have been handed over to the Client. Jones Lang LaSalle’s services shall not include any legal or tax-related advice.
The written report on the agreed services shall be deemed applicable. Verbal statements and information provided by Jones Lang
LaSalle staff outside the terms of the agreed contract should be deemed non-binding, unless confirmed in writing.
b)
Jones Lang LaSalle will fulfil the contract to the best of their knowledge and skill with due care and diligence, and in the case of a
valuation, in accordance with the principles of the Royal Institution of Chartered Surveyors (RICS), an extract of which has been
supplied to the Client.
c)
Jones Lang LaSalle has the right to instruct specialist third parties (i.e. vicarious agents, or “Erfüllungsgehilfen”) to fulfil its
contractual obligations.
d)
Jones Lang LaSalle will only verify the information, especially numbers, provided by the Client for obvious inconsistencies and faults.
In all other cases, Jones Lang LaSalle will assume the information provided by the Client is correct and complete. Furthermore, Jones
Lang LaSalle accepts no responsibility for the accuracy or completeness of the documents and information provided by the client,
whether it is in verbal, written or electronic format.
e)
The Client does not have the right to demand that the contract be carried out by a specific employee of Jones Lang LaSalle.
f)
Jones Lang LaSalle is under no obligation to inform the Client about any alterations or their implications resulting from a change in
the conditions underlying the conclusions and recommendations of the contract specified above after the execution of the contract.
g)
All changes and extensions to the contract must be made in writing. The same holds true for the waiver of this written contract
agreement. Jones Lang LaSalle shall perform additional services required by the Client that are not specified in the original contract
only on the basis of a separate agreement with a separate remuneration and liability. Should Jones Lang LaSalle render these services
without both parties being able to agree to an appropriate remuneration for such additional services, the Advisor’s fee will increase
according to the additional time and money required by the Advisor. Otherwise, the provisions and conditions of this Agreement
remain applicable.
3
Deadline for Delivering Services
Any agreed deadline for delivering services shall be reasonably extended in case of force majeure or any reason for which the Advisor
is not responsible but which may temporarily impair them from carrying out their work. Jones Lang LaSalle shall notify the Client
without undue delay of any impediment to the performance of these services and the expected duration of the delay.
4
Information and Documentation supplied by the Client
a)
The Client is obliged to assist Jones Lang LaSalle in the execution of the agreed contract as required, especially by supplying the
necessary information and documentation properly, fully and on time. This also applies to documentation and information, which only
become known or available during the course of the instruction of Jones Lang LaSalle. Should the Client fail to meet any of the
aforementioned obligations to support Jones Lang LaSalle, Jones Lang LaSalle, notwithstanding their claims for compensation for
additional expenses and damages, reserves the right to extraordinarily terminate the contract without notice.
b)
Upon Jones Lang LaSalle's request, the Client shall confirm in writing the accuracy and completeness of all written documentation and
information supplied as well as all verbal statements, if such a confirmation is possible through a necessary factual review without
incurring additional costs or effort.
5
Guarantee
a)
The Client has the right to demand that any deficiencies be corrected by Jones Lang LaSalle, to the extent that this is possible and
reasonable for Jones Lang LaSalle. Should Jones Lang LaSalle not be able to or fail to correct the deficiency, the Client reserves the
right to cancel the contract or reduce the fees. If the contract has been awarded by a merchant within the scope of its commercial
activities, by a public-law legal entity or by a public-law fund, the Client can only cancel the contract if Jones Lang LaSalle’s work is
of no further interest to the Client, because of the failure of Jones Lang LaSalle to correct the deficiency. All further damage claims are
governed by section 6 below.
b)
The Client is required to report any obvious shortcomings in writing within two weeks of the completion of services. Should the Client
be a merchant, patent defects shall be notified without undue delay and latent defects shall be notified without undue delay and in
writing upon discovery. In any case, claims because of defects must be notified no later than six months after completion of services.
If the Client fails to report errors in due time, any claim for correction of these deficiencies and all other claims because of the defect is
excluded.
c)
Obvious errors, such as typing and arithmetical errors and deficiencies of form may be corrected by Jones Lang LaSalle at any time
also with effect against third parties. Errors which are apt to question the results contained in Jones Lang LaSalle’s written report
entitle Jones Lang LaSalle to withdraw such statements also with effect against any third party. In such cases Jones Lang LaSalle will
first give the Client an opportunity to comment.
6
Liability and Disclosure of Information to Third Parties
a)
Jones Lang LaSalle only assumes unlimited liability – irrespective of the legal reason – for damage resulting from wilful misconduct
or grossly negligent conduct caused by a legal representative, employee or vicarious agent (“Erfüllungsgehilfe”) of Jones Lang
LaSalle. Otherwise, Jones Lang LaSalle’s liability for damage caused by Jones Lang LaSalle, its legal representatives, employees and
vicarious agents – irrespective of the legal reason – shall be limited to a maximum total amount of € 7.5 million (in words: seven point
five million euros), unless agreed otherwise by the Advisor and the Client.
b)
Any liability for lost profits shall be excluded.
c)
The aforementioned maximum liability amount shall also apply if the damage is based on various or several similar professional errors
or an error that has resulted in different types of damage and/or if there is more than one claimant.
d)
If compensatory damage claims against Jones Lang LaSalle are excluded or limited, this shall also apply with regard to the personal
liability of Jones Lang LaSalle's legal representatives and employees.
e)
The aforementioned exclusions and limitations of liability shall not apply to damages arising from injury to life, limb or health.
f)
The contractual remuneration has been determined on the basis of the performance and obligations specified in this Agreement. Jones
Lang LaSalle's responsibilities under this Agreement and its performance shall be towards the Client exclusively. The results of the
work executed by Jones Lang LaSalle shall remain confidential and are intended exclusively for the Client and only for the purposes
specified in this Agreement. Any other use and, in particular, disclosure to third parties or other publications (disclosure to third
parties) – including extracts – without Jones Lang LaSalle's prior written consent shall be prohibited. In the event of consent to
disclosure to a third party, the Client agrees to notify the respective third parties in writing and to underline that Jones Lang LaSalle
generally assumes no liability towards third parties for the work and services provided and that third parties may make no claims
whatsoever against Jones Lang LaSalle on the basis of the work and services provided. The Client also agrees to indemnify Jones Lang
LaSalle against any third party claims and associated costs asserted by third parties against Jones Lang LaSalle as a result of
unauthorised disclosure or publication of the results of the work and services provided. "Third parties" in this context shall also include
the Client's Affiliates.
g)
Jones Lang LaSalle may assume liability towards third parties for its valuation only if the relevant third party has accepted the
limitation of liability set forth in section 6 and has accounted for the respective additional remuneration for the joint and several
liability.
h)
Should Jones Lang LaSalle have assumed liability as against third parties for its valuation pursuant to section 6f) and 6g), this shall be
done only on the basis of the following minimum fee rates per contract volume:
Market value resp.
Fair Value
First party
Second and
subsequent parties
For the first ten million
euros
0.05%
0.02% per party
For the following
ninety million euros
0.025%
0.01% per party
Thereafter
0.0125%
0.005% per party
The percentage rates set forth above shall be applied to the determined market value respectively fair value of the real estate, which is
defined in § 2 of Jones Lang LaSalle's "General Principles for Preparing Valuations and Reports". The above-mentioned rates do not
include value added tax and shall be no less than € 500 per designated additional party.
7
Restriction on Use and Copyright Protection
a)
The Client guarantees that the valuations, reports, plans, drafts, sketches, tables and calculations prepared by Jones Lang LaSalle as
part of the contract shall be used only for the contractually agreed purposes and may not be published in individual cases without Jones
Lang LaSalle's express consent.
b)
Should the work produced qualify for copyright protection, Jones Lang LaSalle shall remain the author. In such cases, the Client shall
be granted a limited, irrevocable, exclusive and non-transferable licence to use the work produced.
8
Return of Documents
After settlement of all conditions agreed in the advisory, valuation or market research contract, Jones Lang LaSalle, on request of the
Client, shall return all documents obtained from the Client in order to carry out the instruction. This does not apply to correspondence
between the contractual parties and for copies made of the valuations, reports, plans, drafts, sketches, tables and calculations prepared
as part of the contract as well as other documents, which Jones Lang LaSalle is legally bound to store or entitled to. The Advisor also
has the right to make copies of these released documents for its files.
9
Confidentiality
Jones Lang LaSalle will treat all business and operational secrets of which it becomes aware in the context of the contract and that are
recognisable as such and all information indicated to be confidential as confidential, as long as this information is not required by law
or public authority. The Advisor will only divulge reports, valuations and other results containing such information to third parties
with the consent of the Client, unless required by law or public authority.
10
Payment Conditions
a)
The agreed remuneration will be payable immediately upon issue of invoice without any deductions.
b)
If there is more than one client, they shall be jointly and severally liable.
c)
A set-off of claims of the Advisor for fees and payment of costs is only possible with an uncontested and legally recognised claim.
11
Miscellaneous
a)
Rights under the contractual relationship with the Advisor may be only assigned subject to its prior consent.
b)
The laws of the Federal Republic of Germany shall apply to the execution of all contracts relating to general advisory, valuation and/or
market research services and all claims resulting thereof.
c)
If the contract has been awarded by a registered trader (“Vollkaufmann”), public-law legal entity or public-law fund, the place of
jurisdiction is Frankfurt am Main.
d)
Should any individual clause of these Standard Terms of Business be deemed void, this will not affect the validity of any other parts of
these Standard Terms of Business. The invalid provisions shall be replaced by that which lawfully most closely reflects the desired
purpose.
e)
All amounts mentioned above are in euros and shall be subject to the legally valid Value Added Tax at the time of the work was
executed, unless explicitly excluded.
f)
A copy of the internal complaints handling procedure can be made available on request.
Andrew m. Groom MRICS
International Director
Wilhelm-Leuschner-Straße 78
60329 Frankfurt/M.
Frank Rambow MRICS
National Director
60329 Frankfurt/M.
Norbert Schultek
Senior Consultant
60329 Frankfurt/M.
+ 49 (0) 69 2003 1241
[email protected]
+ 49 (0) 69 2003 1186
[email protected]
+ 49 (0) 69 2003 1346
[email protected]

Valuation Report `Matrix Portfolio, Valuation of 13 properties`

Transcription

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