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NAI apollo: Frankfurt am Main’s office lettings market in top form

  • First-three-quarter take-up of 440,900 sqm one of best results since data collection began
  • Growing number of deals signals positive market dynamics
  • Banks, financial service providers and insurers dominate take-up activity
  • Vacancies amount to only 826,000 sqm
  • Rental prices characterised by further growth
  • Outlook for 2018 as a whole: above-average space take-up, continuous reduction in vacancies and further rental price growth

 Frankfurt am Main, 1st October 2018 – The Frankfurt market for office space including Eschborn and Offenbach-Kaiserlei continued to perform strongly in the third quarter of 2018 following the extremely positive first half of the year, according to the latest analysis by owner-managed real estate consultancy NAI apollo – partner of the NAI apollo group. Space take-up by tenants and owner-occupiers reached 187,300 sqm, meaning that the period from July to September 2018 represents the strongest third quarter in the past ten years. The already very good result of the prior year was exceeded by 1.8 % (Q3 2017: 183,900 sqm). “Space take-up for the first three quarters of 2018 amounted to 440,900 sqm, which is one of the best results we have seen since we started to collect data. It has risen 2.0 % or 8,700 sqm above the very high previous year’s value,” said Radomir Vasilijevic, Director Office Letting at NAI apollo.

A year influenced by strong market dynamics

The number of deals provided even more tangible evidence of the strong market momentum, rising from 530 in the first three quarters of 2017 to 576. “We noted there were a high number of lease contract signings while lease renewals had less of an impact,” said Radomir Vasilijevic. At the end of the third quarter, renewals accounted for 36,000 sqm.

Compared to the very good previous year, the lettings volume was particularly influenced by an increase in the number of contract signings within the <1,000-sqm and 1,000 sqm-2,500sqm segments, at 12.5 % and 6.4 % respectively. The largest deals in the year to date include the rental by Commerzbank of more than 36,100 sqm in Cielo (100, Theodor-Heuss-Allee 100), the lease signed by Frankfurter Allgemeine Zeitung for 24,000 sqm in a project development at 92, Europa-Allee, and the deal completed by Spaces for 9,200 sqm in Global Tower (32-36, Neue Mainzer Straße). NAI apollo acted as consultant to Spaces in the latter deal. 

Banks, financial service providers & insurers form the largest user group

“In the third quarter of 2018, a number of banks rented new premises. Thus the banking, financial services and insurance sector played an even stronger role than in the first half of the year, increasing their share from 20.2 % at the end of June to 25.4 % or 111,900 sqm,” said Dr. Konrad Kanzler, Head of Research at the NAI apollo group. As before, the construction and real estate sector, boosted by the Spaces contract, was ranked second and accounted for a 15.8 % market share (69,800 sqm) at the end of the third quarter. 

More than two thirds of space take-up took place in the Central Business District (CBD). The most significant sub-markets within the CBD are the banking district and City West, with market shares of 19.2 % (84,500 sqm) and 13.7 % (60,300 sqm) respectively. 

“Rental prices have continued to rise owing to high-priced rentals in project developments and other areas. Thus the prime rent increased by €0.50/sqm to €41.50/sqm compared to the previous quarter, and is only €0.50 below the peak value of the last 15 years. The space-weighted average rent increased by a further €0.10 on a quarterly basis to €21.50/sqm,” said Dr. Konrad Kanzler.

Vacancies fall further

The office completions volume amounted to 32,500 sqm for the third quarter of 2018, while almost the same volume (29,100 sqm) was removed from the office market. As a consequence, office stock was broadly unchanged at 11.34 million sqm. “For the fourth quarter of 2018, we expect additional 64,100 sqm to be completed. However, only 2,900 sqm of this volume is still available. In 2019, 180,200 sqm of office space will in all probability come onto the market. The pre-letting quota here stands at 49 %,” said Radomir Vasilijevic. 

The very positive lettings performance and high pre-letting quotas in project developments brought about a further significant decline in vacancies in the period from July to September 2018. “Market-active vacancies on the Frankfurt office space market — that is, office spaces that can be occupied within three months of the contract signing — fell by another 55,000 sqm to 826,000 sqm,” said Dr. Konrad Kanzler. The resulting vacancy rate is 7.3 %, which fell 0.5 percentage points within the last three months. 

Annual result expected to be far above average

“Upcoming lettings in the fourth quarter will help maintain the positive market development, and we expect to see above-average space take-up in 2018. At best, we will even experience one of the three strongest performances of the last 25 years. In line with this development, vacancies will continue to decline and rental prices will increase further,” summed up Radomir Vasilijevic.

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NAI apollo negotiates contract for site of new DFB commercial building in Langen

Frankfurt, 07.09.2018 – The German Football Association (Deutsche Fußball-Bund, or DFB) has awarded a contract for the construction of a commercial property in Langen on a site that was secured for this purpose by owner-managed real estate consultancy NAI apollo. DFB logistics specialists will eventually occupy the premises on Raiffeisenstraße that will comprise 4,000 sqm of hall space and 600 sqm of office space. They are responsible for providing the DFB national teams with their official and training kit and supplying team equipment to all DFB bases. Commercial property specialists MP Holding will start construction of the building in the fourth quarter of this year. Completion is currently scheduled for the second quarter of 2019.

MP Holding will be seeking a DGNB certificate in gold for the sustainability of the building. In order to achieve this aim, measures will include the installation of an underfloor heating system for more efficient climate control. The 7,950-sqm site is situated in an industrial area of Langen on the B486 federal highway, which also provides access to the national road network via the A5 and A661 motorways. The property is only 25 minutes by car from the DFB headquarters on Otto-Fleck-Schneise in Frankfurt.

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VIVANIUM takes over property management business of NAI apollo

Frankfurt, 03.09.2018 – VIVANIUM has acquired the property management business of owner-managed real estate consultancy NAI apollo. The property management specialist based in Heidelberg takes over the business activities of the NAI apollo property management division with effect from 1 September 2018. The parties have agreed not to disclose the purchase price.
VIVANIUM, the owner-managed property management specialist that is active throughout Germany, is using the acquisition to expand its presence on the Frankfurt market. Dirk Tönges, managing partner of VIVANIUM, said: “The acquisition provides an ideal basis from which we can access the market in Frankfurt and the wider region. It opens up new acquisition channels as well as the opportunity to expand our portfolio in a long-term collaboration with NAI apollo.”
The transaction will enable NAI apollo to focus on its core business areas. Andreas Krone, CEO of NAI apollo, said: “Property management is facing major changes, such as those brought about by digitalisation, for example. VIVANIUM is a proven property management specialist and is able to address these challenges in a targeted way. We will make use of the transaction to strengthen our focus on business areas such as asset management, letting, investment and corporate finance, as well as the opportunities created by digitalisation.”

The property management unit of NAI apollo employs 15 people and manages a total of 25 buildings and 800,000 sqm of rental space. VIVANIUM will take over the unit’s mandates as well as its employees, who will continue to support customers from their current premises on Schillerstraße in Frankfurt. “Nothing will change for the customers,” said Dirk Tönges. “We will take over all operations and contracts in a seamless manner.”
Michael Frieling, authorised representative of VIVANIUM and managing director of VIVANIUM subsidiary Viva Dream, a joint venture with Dream Global Advisors, is taking over the management of the new VIVANIUM office in Frankfurt.

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NAI apollo brokers commercial and office space letting in Nauheim

Frankfurt, 29.08.2018 – The owner-managed real estate consultancy NAI apollo has brokered the letting of a 1,200-sqm storage and office unit to a commercial tenant in Nauheim. The rented property in the Schleifweg industrial zone comprises 1,166 sqm of warehouse and 35 sqm of office space.

The tenant and landlord are both from the construction industry. The lease contract has a ten-year term and the occupancy period starts on 1 January 2019. The tenant has rented the premises as part of a takeover to support its expansion strategy.

The property is situated in the centre of Nauheim close to the regional railway station (S-Bahn). Its proximity to the “Rüsselsheimer Dreieck” traffic junction also provides easy access to the national road network.



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Sopro Bauchemie leases 4,700 sqm of logistics space in Wiesbaden-Nordenstadt

Frankfurt, 23.08.2018 – The owner-managed real estate consultancy NAI apollo has brokered the lease contract for approx. 4,700 sqm of logistics space in Wiesbaden-Nordenstadt. The tenant is Sopro Bauchemie GmbH, which is renting the unit at 6, Ostring for the storage and distribution of its products. The landlord is the family-run company May & Co. Wohn- und Gewerbebauten from Itzehoe.

The mixed-use property offers a total rental area of about 15,500 sqm. Superfly Air Sports Wiesbaden GmbH is another anchor tenant in the building and operates a trampoline park on site. In total, a further 2,800 sqm of hall and office space is still available.

Sopro Bauchemie GmbH, one of the leading suppliers of building chemical products in Europe, is leasing the space in the east of the city to support its expansion strategy. The site is situated close to the A66 motorway, and Frankfurt Airport is only 15 minutes away by car via the adjacent Wiesbaden motorway junction (Wiesbadener Kreuz). In addition, Sopro Bauchemie’s production site at 74, Biebricher Straße in Wiesbaden is only about 10 kilometres away.


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Deutsche Flugsicherung leases 3,100sqm of warehouse space in Dreieich

Frankfurt, 21.08.2018 – Owner-managed real estate consultancy NAI apollo has brokered the letting of around 3,100 sqm of warehouse and logistics space in Dreieich to Deutsche Flugsicherung. The German air navigation service provider will move into the premises at 10, Lise-Meitner-Straße from September 2018. The landlord is KS Verwaltungsgesellschaft mbh — a private property management firm based in Dreieich.

The commercial property offers a total rental area of about 8,300 sqm, of which 4,000 sqm of warehouse space and around 1,200 sqm of office space is still available. The hall areas in the building are already partially equipped with shelving. Deliveries are made via ramps with dock levellers. The site is located in the Dreieich-Sprendlingen industrial zone and the nearby A661 motorway provides easy access to the national motorway network.



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NAI apollo brokers sale of commercial property in Bad Homburg

Frankfurt, 17.08.2018 – The owner-managed real estate consultancy NAI apollo has brokered the sale of a 1,500-sqm commercial property in Bad Homburg to a private buyer. The seller is a private investor. The premises at 20, Steinmühlstraße include 1,100 sqm of hall space and 400 sqm of office space.

The building is situated in an industrial zone near to the Bad Homburg ‘Kreuz’ (motorway intersection). It provides space for production companies with a focus on craft industries and trade. Well-known companies such as Stadtwerke Bad Homburg, Fresenius SE & Co. KGaA and DMG MORI Frankfurt GmbH are already based in this area. The A5 motorway provides access to the national road network.


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NAI apollo Munich successfully negotiates two deals for I.G. Pflanzenzucht

Munich, 01.08.2018 – Owner-managed real estate consultancy NAI apollo – partner of the NAI apollo group – negotiated the lease contract for 450 sqm of office space on Reichenbachstrasse street in Ismaning for I.G. Pflanzenzucht GmbH. The landlord is LBBW Immobilien. NAI apollo was also able to let the former office location of I.G. Pflanzenzucht on Nußbaumstrasse at Sendlinger Tor in Munich to etcos immobilien management GmbH. The rental space in the office property, which belongs to I.G. Pflanzenzucht, comprises 230 sqm.

I.G. Pflanzenzucht specialises in the sale of seeds and is one of the oldest plant breeding groups in Germany. The company decided to extend its premises as a result of recent expansion.

Steffen Hecht from NAI apollo said: “We are delighted to have been able to accomplish two goals at the same time for I.G. Pflanzenzucht GmbH, securing a new office space for the company on one hand while also finding a tenant for its former premises on the other. Furthermore, we were able help etcos immobilien management GmbH, a company with close ties to us, obtain a new office space.”


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NAI apollo negotiates sale of commercial property on the Nürburgring racetrack

Frankfurt am Main, 17.07.2018 – Owner-managed real estate consultancy NAI apollo – partner of the NAI apollo group – has arranged the sale of a commercial property with approx. 3,100 sqm of floor space in Meuspath in North Rhine-Westphalia to a German automotive group. NAI apollo had been exclusively mandated to place the property, which is situated on a 12,000-sqm plot. The is Bridgestone Germany. The parties agreed not to disclose the purchase price.

The site is located in an industrial area near the Nürburgring racetrack and is home to numerous companies involved in motor sports. Among other activities, these companies test their latest developments on the Nürburgring circuit, which at 26km is the longest permanent racetrack in the world. It is only a five-minute journey from the Meuspath industrial area.

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NAI apollo: Slump in large off-plan leases reduces take-up in the market for warehouse and logistics space in the Rhine-Main area

  • Take-up in first half of 2018 falls almost 13 per cent year-on-year to 322,000 sqm
  • Decrease in the segment for “5,000-sqm plus” spaces and off-plan lease contracts
  • Acceleration of project completions; new building projects on the starting block
  • Forecast: Stabilisation of market activity and a year-end result in line with the long-term average

Frankfurt am Main, 12.07.2018 – Rental activity on the market for warehouse and logistics space in the Rhine-Main region weakened slightly in the second quarter of 2018 following a good start to the year, according to the latest analysis from owner-managed real estate consultancy NAI apollo – partner of the NAI apollo group. Take-up by tenants and owner-occupiers reached about 155,000 sqm in the last three months, a decrease of 7.2 per cent compared to the first quarter of the year. The half-year take-up volume amounted to about 322,000 sqm, which represents a 12.8 per cent decline compared to the first half of 2017.

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