Karlstraße 3

 Development loan
Project listed: 06.04.2020
Eisenach,
Germany
4.75%
Annual yield
Term: 36 months
Mortgage rank:
Second
Interest payment schedule:
Quarterly
Interest payments
22.06.2020
Paid
22.09.2020
Paid
22.12.2020
Pending

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Descripton

Project Presentation

The rented residential and commercial building is characterized not only by its excellent location in the historic center of Eisenach but also by important visitors in the past: Goethe and Napoleon were guests in this very house (see picture gallery). The very well-kept house is located in the middle of the pedestrian zone in Eisenach and comprises 7 commercial units and one residential unit. The total usable space of the house is approx. 1,504 m² and it currently generates a net annual rent of around EUR 133,000, which corresponds to a net rent of just under EUR 8.87/m². Embedded in the pedestrian zone of Eisenach and in the immediate vicinity of important national and international chain stores, the building is in a sought-after location, which benefits all tenants in the building.

Eisenach is located in the west of Thuringia and is the sixth-largest city in Thuringia with about 43,000 inhabitants. Since 1998 Eisenach has been a district independent city and is the center of Western Thuringia. Eisenach is known for the Wartburg Castle above the city, which is a UNESCO World Heritage Site and was the seat of the Landgraves of Thuringia in the Middle Ages. There Martin Luther translated the New Testament from Greek into German in autumn 1521. In 1817, the Wartburg festival took place there, one of the most important events of the pre-March period. Since February 2017 Eisenach is also a university town, which leads to an increased influx of young people. In the course of industrialization in the second half of the 19th century, automobile factories gradually settled in Eisenach: first BWM, which built the 'Wartburg' in Eisenach from 1928, and today Opel and Bosch, which employ 4,000 people in the region.

Deal Highlights

 

MAGAN Group

The MAGAN Group is active in project development and portfolio optimization of real estate. It is characterized by over 30 years of market knowledge in Austria and more than 15 years in Germany. Since 2004, the beginning of its activities in Berlin, the group and its partners have successfully implemented more than 200 of its own projects in Germany, generating a volume of more than €500 million in its own investments. This makes MAGAN one of the most experienced foreign real estate investors operating in Germany, who discovered this market for themselves early on.

 

Already annual rental income of € 133,000

The annual net rental income currently amounts to € 133,000, which corresponds to a sustainable net rent of just under € 8.87/m², which is customary for the location. In view of the extremely good location within Eisenach, a low vacancy rate can be expected in the coming years.

 

Rendity Instant Interest

Investors receive from the deposit of the investment the Rendity Instant Interest, which will be paid after the funding period. With the Rendity instant interest, you not only receive interest on your invested capital for the loan term but also for the time before that. Thus, you already receive interest for your investment during the funding period. You will receive your Rendity Instant Interest at the end of the funding period.

 

Regular additional income - 4.75% p.a. Distribution every 3 months

Investors receive quarterly distributions of 4.75% p.a. on their invested capital during the term of the investment. The invested capital is repaid to the investors at the end of the term.

 

Germany as an investment location

Germany is the largest economy in Europe and in recent years has developed into the second-largest real estate investment market in the world. In addition to national investors, there is now an increasing number of international investors who have confidence in the German business location.

 

'The best house on the square'

Since 2004, the MAGAN Group has concentrated on the purchase and management of houses in the best locations in small and medium-sized cities in Germany. Embedded in the pedestrian zone and in the immediate vicinity of important national and international chain stores, Bahnhofstrasse 14 is in a sought-after frequency location.

Investment-Case

For the purpose of partial refinancing, Melkus Real Invest GmbH intends to take out qualified subordinated loans of up to € 500,000.

The Borrower is the owner of the property with the address Karlstraße 3, 99817 Eisenach. The apartment building comprises 7 commercial units and 1 residential unit with a total floor space of 1,504 m². In total, annual net rental income of approximately EUR 133,000 is currently generated, which represents a yield of 6.2%.

The house is part of the existing 'MELKUS' portfolio, which currently consists of the following properties:

  1. Bahnhofstraße 14, 08523 Plauen, with total purchase costs of about EUR 870,000, committed equity of about EUR 250,000 and a net annual rent of currently EUR 60,000;
  2. Schuhmannstraße 12, 08056 Zwickau, with total purchase costs of about EUR 1,725,000, committed equity of about EUR 525,000 and a net annual rent of currently EUR 96,000;
  3. Karlstraße 3, 99817 Eisenach, with total purchase costs of about EUR 2,135,000, committed equity of about EUR 735,000 and a net annual rent of currently EUR 133,000.

Business Case

During the holding period, the owner will optimize the portfolio. In addition to technical improvements (such as conversion, extension and expansion measures), beautification measures, this also includes increasing income in the form of legally permissible rent increases or new lettings. After the successfully completed optimization phase, the portfolio is to be sold by 2023 at the latest, ideally at a lower return - i.e. at a higher absolute price in relation to the rental income - than the purchase was previously made.

 

Tenant structure

In total, the apartment building has a usable space of 1,504 m² divided into 7 commercially used units and one residential unit. Long-term, locally customary rental agreements have been concluded with all tenants. The commercial tenants consist of the following tenants.

Dietz Coiffeur Cosmetic Team

Schuh Galerie ESA GmbH

ETL Rechtsanwälte

Dr. Mechthild u. Bambach- Psychologische Psychotherapeutin.

 

Location 

Eisenach is located in the west of Thuringia and is the sixth-largest city in Thuringia with about 43,000 inhabitants. Since 1998 Eisenach has been a county borough free city and is the centre of Western Thuringia. Eisenach is known for the Wartburg Castle above the city, which is a UNESCO World Heritage Site and was the seat of the Landgraves of Thuringia in the Middle Ages. There Martin Luther translated the New Testament from Greek into German in autumn 1521. In 1817, the Wartburg festival took place there, one of the most important events of the pre-March period. Since February 2017 Eisenach is also a university town, which leads to an increased influx of young people. In the course of industrialization in the second half of the 19th century, automobile factories gradually settled in Eisenach: first BWM, which built the 'Wartburg' in Eisenach from 1928, and today Opel and Bosch, which employ 4,000 people in the region.

Das beste Haus am Platz

In keeping with the MAGAN Group's corporate philosophy of 'the best house on the square', Karlstrasse 3 is also distinguished by its exceptionally good location within Eisenach. Embedded in the pedestrian zone and in the immediate vicinity of important national and international chain stores, the building is in a sought-after frequency location, from which current tenants benefit. Thanks to the prime location in Eisenach, tenants with strong credit ratings have always been able to be retained in the long term.

Discover the surroundings

Wartburg

The Wartburg is a castle in Thuringia, situated above the town of Eisenach at the north-western end of the Thuringian Forest 411 m above sea level. It was founded around 1067 by Ludwig the Springer and has been a UNESCO World Heritage Site since 1999. Today's Wartburg Castle was largely rebuilt in the 19th century, including a few preserved parts. The present appearance of Wartburg Castle and its landscape park can be traced back to Grand Duke Carl Alexander of Saxony-Weimar-Eisenach. The Wartburg has also gained special historical significance because the reformer Martin Luther was imprisoned there for his own safety but originally against his will. He used the time in his sparse and spartan quarters to realize one of his most important projects: the translation of the New Testament into German.

Stadtpark

The Stadtpark is a historical landscape park in the center of Eisenach in Thuringia. The city park is located east of the old town of Eisenach on the Pflugensberg. To the north, the city park extends as far as the historic development on Waldhausstraße with the future building site of the controversial Eisenach large-scale project 'Gateway to the City' and as far as Eichrodter Weg near the freight station. Today's park is made up of three areas: the wooded strip along Eichrodter Weg and Riesengraben, which was reforested in the 19th century as 'Eisenacher Stadtwald', forms the eastern part of the park. In the center is the city park, designed around 1880, with a playground, sunbathing areas and a network of paths. The western area originally belonged to the Villa Pflugensberg ('Eichelscher Garten'), it was purchased by the city administration in 1923. At the confluence of Stadtparkstraße and Karthäuserstraße (today Mitzenheimstraße into Wartburgallee) there is a semicircular open space as the entrance to the park, where the Bismarck monument was located from 1903 to 1963.

Bachhaus

The Bachhaus Eisenach is a museum in Eisenach, Thuringia, dedicated to the composer Johann Sebastian Bach, who was born there. It has 600 m² of exhibition space and displays around 250 original exhibits, including a Bach autograph of sheet music. The core of the museum, which today comprises several buildings, is an approximately 550-year-old half-timbered house (Frauenplan No. 21), which was falsely identified as Bach's birthplace in the middle of the 19th century. In 1907 the Leipzig New Bach Society established it as a memorial and Bach Museum.

Lutherhaus

The Luther House in Eisenach is one of the oldest preserved half-timbered houses in Thuringia. According to tradition, Martin Luther lived there with the Cotta family during his school years from 1498 to 1501. Martin Luther stayed in his 'dear town' Eisenach several times in his life, first as a young student and later in the Wartburg, where he worked on his Bible translation.

Rathaus

The town hall of the city of Eisenach is a listed building in Eisenach, Thuringia. Since the end of the 16th century, it has served as the seat of the city administration and the (head) mayor of Eisenach. The town hall is located in the center of Eisenach on the east side of the market square at the entrance to Karlstraße directly next to the Eisenach town palace and the building of the town pharmacy. It can be reached in a few minutes from the existing building at Karlstraße 3.

Eisenach Hauptbahnhof

The Eisenach railway station is the most important railway station of the city of Eisenach in Thuringia. It is a traffic junction and is located on the Thuringian Railway (Halle-Bebra) and the Werra Railway (Eisenach-Meiningen-Eisfeld). It is the central hub of rail traffic in Thuringia and is maintained and operated by Deutsche Bahn. The six tracks are used for both regional and long-distance trains.

Team

MAGAN

Many years of real estate and financing experience in Germany

 

In total, the management team of the MAGAN Group around the managing director and owner Alexander Neuhuber has decades of experience in the real estate industry, especially in Berlin and the new German states.

MAGAN Managing Director Alexander Neuhuber is one of the most well-known and distinguished real estate entrepreneurs in Austria. As early as 1988 he founded his first real estate agency 'Neuhuber und Partner'. In the early 1990s, Neuhuber succeeded in taking over the Austrian general representation of DTZ (Debenham Thorpe Zadelhoff, later Debenham Tie Leung), one of the largest global real estate consulting companies. In 2001, he sold the company, then ranked third on the list of the largest Austrian commercial estate agents, to his British partners. Originally founded as a pure holding company for investments, Magan Holding GmbH was then the operative company of the group for a long time. In order to define the business areas even more clearly and to express this in the company name, Magan Holding GmbH will be renamed Magan Advisors GmbH in autumn 2018. With this company he advises a top-class clientele on the selection and execution of real estate transactions, as investor or owner representative. A unique selling point is the support of Austrian investors in their purchases and sales in Germany. Since 2004 Neuhuber has also been active with the Magan group of companies in Berlin and the new federal states, and since 2014 he has also been operating a Magan office in Leipzig. The second pillar of the Magan Group can be described as Private Equity/Club Deals. Here, real estate is purchased, managed and finally also sold again within the framework of changing investment companies, with various partners, on their own account.

Since autumn 2017 DI(FH) Michael Alexander Mitterdorfer has taken over as Head of Transaction Management and Investment of the MAGAN Group and can look back on more than 10 years of professional experience in the real estate industry. Through his career with well-known real estate companies such as EHL, Bank Austria Real Invest, and BAR, he has been able to continuously expand his investment know-how and his international network. He was able to expand his German expertise most recently as Head of Real Estate Acquisition at Immowert Immobiliengruppe. As a transaction manager, he is responsible for the selection and execution of real estate transactions within the MAGAN group of companies as well as for MAGAN clients.

The borrower is Melkus Real Invest GmbH, 50% owned by MAGAN Capital GmbH, registered in the commercial register of the Vienna Commercial Court under FN 500513 z and headquartered at Jakobergasse 4/14, 1010 Vienna. The other 50% is held by Szakoru GmbH, which is under the economic influence of the well-known notary public, Martin Köhler. Both owners are among the 'early movers' with regard to property investments in Germany and have decades of market experience. In 2004, MAGAN recognized the drastic undervaluation of Berlin apartment buildings and residential real estate and started to build up an apartment building portfolio.

From 2005 to 2007, Mr. Neuhuber and his partner, the Austrian Stumpf Group, jointly acquired almost 70 apartment buildings in Berlin, Potsdam, and Leipzig as part of a private equity investment. This resulted in a portfolio with around 1,500 existing units (Spree one and two GmbHs and Wannsee GmbH). After a phase of optimization of the properties and their management, the sale of approx. 600 condominium apartments and the remaining properties in global sales will follow in 2011 to 2014. From the beginning of 2014, MAGAN and a new partner (Trabi Immobilien) purchased apartment buildings in Leipzig, Dresden, Halle, and other cities. By summer 2016, a total of 33 properties in the new German states had been acquired and managed. In 2017 the portfolio was sold globally to a German institutional investor. Since 2016, the MAGAN Group has been acquiring mainly residential apartment buildings in the target markets with new private equity companies, the Horch Group. To date, more than 30 properties have been purchased, and a partial package in Leipzig was already sold again at the end of 2018.

An additional, newer mainstay of MAGAN is the Wartburg group of companies, with which - again in the form of a club deal - individual condominiums are acquired. By the beginning of 2020, more than 120 condominiums have already been purchased in the cities of Leipzig, Dresden, Chemnitz, Magdeburg, Halle, Chemnitz, Zwickau, and Gera.

Project originated by:

Documentation

4.75%
Annual yield
Term: 36 months
Mortgage rank:
Second
Interest payment schedule:
Quarterly
Interest payments
22.06.2020
Paid
22.09.2020
Paid
22.12.2020
Pending
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