JUVE Law Firm of the year

Real Estate

Strong economy buoys up transaction market

The euphoria in the real estate market is not dying down, and the transaction market is booming. Individual transactions are common, but portfolios are still changing owners as well. At the same time, the strong economy is bringing foreign money into Germany. US investor Brookfield snapped up one of the last gems: with an estimated purchase price of around one billion euros, the acquisition of the Potsdamer Platz site was one of the top deals seen in recent years. An Asian sovereign wealth fund was also part of the action.

Brexit could fire up the German market even further: as it becomes more uncertain how the London real estate market will develop, Germany becomes more attractive to investors. Some banks have already ceased to provide credit for investments in the British real estate market.

Meanwhile, the consolidation in the housing sector is taking a break. After months of battling, Vonovia failed in its plans to take over competitor Deutsche Wohnen. Since then, it has mainly been smaller residential portfolios changing hands.

Boutiques on the advance

The flourishing market offers up-and-coming firms like Jones Day and Herbert Smith Freehills more and more opportunities to position themselves in the market – partly because the established real estate practices are working at a high utilization rate.

In the highlight deals too, the top-flight firms are no longer alone. The Potsdamer Platz deal saw two smaller outfits on the seller side: Iur Realis and KNP Kreikenbohm Niederstetter. The boutique Kucera worked for one of the buyers of Lanxess Arena in Cologne. Only one thing cannot be shaken: market leader Clifford Chance is almost always in the thick of the action when high-profile properties change hands.

Strong links between practices key to success

But for many clients, pure transaction advice is no longer enough, as the market has become more complex. Real estate practices are responding by strengthening ties with other practices, e.g. corporate and tax, because of the growing number of share deals, frequently handled via Luxembourg. As a result, GSK Stockmann + Kollegen and Dentons have now opened offices in this small country, following CMS Hasche Sigle last year. Firms like McDermott Will & Emery and King & Spalding stepped up their involvement in funds. And the interface with public law is also growing in importance, as project development is becoming more and more popular.

The real estate market also saw many lateral moves. Ashurst suffered a heavy blow when two well-respected partners left the real estate practice to open the first German office for US firm Goodwin Procter in Frankfurt at the beginning of the year. Orrick Herrington & Sutcliffe’s Berlin real estate team went to Berwin Leighton Paisner after Orrick closed its office in the capital. The ambitious Jones Day practice was boosted with a long-standing partner from Clifford Chance.



Firms in this chapter offer advice on the acquisition, sale and financing of real estate and portfolios; the structuring of real estate funds ( ?investment funds and asset management); the development of complex real estate projects and industrial real estate ( ?environmental and planning law); project finance and private financing of public real estate projects and privatization; and the renting and leasing of industrial real estate. Clients include funds, institutional investors, financers, investors and institutional developers.

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