Newsletter August 2011



German Cities Ranked by Investment Potential

Welcome to our latest German Property investment update.

If you require any more information on any of our articles or stock, please don’t hesitate to contact us – we are always happy to help. You can also view this update from ProVenture Property online

German Property Market News

View our latest properties

German Property News Online

Large 2,600 unit acquisition for Brack Capital in Leipzig

Podcasts from Property Investor Europe on iTunes

ProVenture’s James views on the German market

Leipzig mentioned in UK Telegraph in top 20 places to buy


Follow us on Twitter for new German properties and investment news

The Eurozone Woes and the pick up for the German Property Market

Well, since our last letter there are been real turmoil within the Eurozone, lead by the re-financing issues of Greece, and the question marks now over the Italian, Portuguese, Spanish and Irish goverments in particular in servicing their debt. Many pundits have been calling the imminent breakup of the Eurozone for some time now, but under political will from France and Germany the currency is fighting on. Clearly a dynamic situation which will develop as the summer unfolds, and government bond traders and credit agencies take their views on the sovereign debt issues.

With the German economy now in better shape than it has been since re-unification, and providing the power to the beleagured Eurozone as a whole, the picture has been very interesting to watch over the past few months. To take a position on what the eventual shape of the Eurozone and the debt issues is very difficult to do. But we hear from many investors that come to us that they see upside in the various scenarios. From a doomsday perspective, they sight a break up of the Eurozone in some form will clearly be very “messy” with wide ranging impacts for central and commercial banks across the world. But any new union of stronger nations that would emerge, which would of course involve Germany, would see an appreciation in the currency rate, now being free of the drag of the so-called “PIIGS”. Whilst this would be the brakes on Germany to export in the volumes that it has done over the last 5 years, any assets based in Germany would see a consequential, and perhaps dramatic, increase.

On the flip side, if the Eurozone gets through these issues in the current format then investors sight the continued benefit to German exports and the booming economy of the lower value Euro from the German perspective. With prices in parts of Germany still some of the cheapest in the developed world, let alone Europe, and interest rates still at historic lows, investors are speaking on this “perfect hedge” against Eurozone issues. Thats not to say we are not in for a turbulent ride in the coming months. Evidence of the above sentiment is being felt in demand for both commercial and residential property investments in Germany. Currently 81% of funds who participate in property are considering Germany above all other markets in Europe in which to make an investment, and global searches for German property have risen 30% this year so far.

German Cities – A Property Investment Ranking

One of the things I have learnt about Germany since working there in 2006 is that they do like to collect statistics. Once analysed, and put into the context of the yield markets in which we operate, this makes our life as easy as analysts of the areas in which we operate and where we should be looking next.

One of the great tools we use is the city rankings table, effectively a ranking of the biggest 100 German cities against a number of current and forward-looking indicators. I want to share this piece of research with you, and use it to explain why we are where we are.

Firstly, lets look at the indicators that are used to come up with the 3 rankings which are Level today, the Dynamic or forward looking ranking and Overall Ranking.

For us at ProVenture, we really look to cities that have a good number of positive dynamic indicators, primarily population outlook but also some other economic changes. By doing this we hope to find areas where property yield is perhaps a little too high currently, based on the current level ranking, but has great potential for increase both in terms of rental and capital values.

So, let’s look at the various rankings and look at who the winners are…

New Ryan Air Route to Leipzig

Ryan Air have finally announced their new scheduled flight from London Stansted to Leipzig Airport, which replaces the old route to Leipzig [Altenburg] which closed in March this year. Leipzig Airport is 20 mins by direct train to Leipzig city centre and trains cost 5 Eur making it very convenient for investors looking at the markets in Leipzig and Halle, which is also 20 minutes distant from the airport. Flight are 5 days per week, not Friday or Sunday, and are scheduled for evening departures with prices from 20 Euro each way currently. The new route opens 1 November, and will make the journey for UK based clients much, much easier. In addition, a route direct from Leipzig is also now running to Rome, on 3 days per week.

Ryan Air Website


Latest IFO News

Latest IFO report – After a positive June, the climate worsens or stays equal in July. Positive climate in construction.

Read the full IFO report here




Latest German Property Offers

PV513-Excellent Refurb Building in Bremerhaven


385,000€ | Bremerhaven

Potential Yield: 10.92%
Type: Residential
Approx. Size: 778 sqm

The object is a full basement house with 10 apartments and 15 garages and parking in the rear part of the plot. The property is in an excellent condition and has been very well maintained. All apartments have a rear balcony and are fitted out to meet all modern requirements. In the last years the roof insulation, Sound proof windows on the road side were replaced and also new rear windows. The public areas are all freshly painted with a new hallway window and front door. The cellar was repainted and all garage roofs and five garage doors replaced. The heating and hot water is supplied via an oil-fired central heating.



PV528- Very High Yield Apartment, Finance possible


23,500€ | Bremerhaven
Potential Yield: 14.81%

Type: Residential
Approx. Size: 70 sqm

The district of Lehe is located north of the centre of Bremerhaven, however still central enough that the city is within easy reach with a short walk or bus ride on the city’s extensive bus network. The historic centre of the district Lehe is the Ernst-Reuter-Platz, which is a very short walk from the property. Here you will find a very grand looking church and the district court forming the centrepiece. Hafenstrasse runs north-south through the centre of the district, and due to its extensive shops, restaurants, schools and local amenities, gives an overall community feel – like a city within a city.


PV529- Very High Yield Apartment, Finance possible


21,000€ | Bremerhaven

Potential Yield: 13.14%
Type: Residential
Approx. Size: 45 sqm

The district of Lehe is located north of the centre of Bremerhaven, however still central enough that the city is within easy reach with a short walk or bus ride on the city’s extensive bus network. The historic centre of the district Lehe is the Ernst-Reuter-Platz, which is a very short walk from the property. Here you will find a very grand looking church and the district court forming the centrepiece. Hafenstrasse runs north-south through the centre of the district, and due to its extensive shops, restaurants, schools and local amenities, gives an overall community feel – like a city within a city.


PV526- Very High Yield Apartment, Finance possible


21,000€ | Bremerhaven
Potential Yield: 16%
Type: Residential
Approx. Size: 67 sqm

The district of Lehe is located north of the centre of Bremerhaven, however still central enough that the city is within easy reach with a short walk or bus ride on the city’s extensive bus network. The historic centre of the district Lehe is the Ernst-Reuter-Platz, which is a very short walk from the property. Here you will find a very grand looking church and the district court forming the centrepiece. Hafenstrasse runs north-south through the centre of the district, and due to its extensive shops, restaurants, schools and local amenities, gives an overall community feel – like a city within a city.


PV527- Very High Yield Apartment, Finance possible


19,000€ | Bremerhaven
Potential Yield: 13.89%
Type: Residential

Approx. Size: 68 sqm

The district of Lehe is located north of the centre of Bremerhaven, however still central enough that the city is within easy reach with a short walk or bus ride on the city’s extensive bus network. The historic centre of the district Lehe is the Ernst-Reuter-Platz, which is a very short walk from the property. Here you will find a very grand looking church and the district court forming the centrepiece. Hafenstrasse runs north-south through the centre of the district, and due to its extensive shops, restaurants, schools and local amenities, gives an overall community feel – like a city within a city.



PV377


1,380,000€ | Leipzig

Potential Yield: 7.2%
Type: Residential
Approx. Size: 1300 sqm

This auction property is based in Leipzig, just north-west of the city centre in a highly desirable and very attractive location close to the heart of the city. It’s a mixture of residential and commercial units spread over 4 floors with additional lettable garages.



PV380


200,000€ | Leipzig
Potential Yield: 12.47%
Type: Residential

Approx. Size: 440 sqm

This is an entirely residential property located in Knautleeberg, an attractive location approximately 15 minutes’ drive from the centre of Leipzig and very close to the ever-popular Codspudener Lake. It is currently 75% let, and on full tenancy it will yield in the region of well over 12%. There are seven apartments spread over 4 floors; six out of seven of the apartments are sized between the high-demand bracket of between 50 – 60 sqm, and the top floor one is 100sqm, suitable for a larger family. The rented units are all let in the region of 5.0 EUR psm.



PV384


250,000€ | Leipzig
Potential Yield: 9.8%
Type: Residential

Approx. Size: 438 sqm

This property is located in Plagwitz, a flourishing area a few kilometres south-west of the city centre. The building is made up of 5 residential units, and one commercial unit on the ground floor. There is an attractive garden – well used by the tenants – and balconies added to each of the units from the 1st – 5th floor. The Karl-Heine area, with the refurbished bridge and extensive plans to improve the canal it crosses make Plagwitz an extremely appealing place to invest, and it is likely to enjoy significant tenant demand over the next few years. There is currently one vacant apartment on the 4th floor, but the property will be delivered fully let.



PV382


410,000€ | Leipzig
Potential Yield: 9.3%
Type: Residential
Approx. Size: 840 sqm

This auction property is in Kleinzschocher, very much in the heart of the blossoming south west of the city. This entire property is constituted of 15 units. Currently, 10 units are let at a level of between 3.4 EUR psm – 5.50 EUR, but mainly at the lower end. The vacant flats need some refurbishment to bring them up to letting standardp, but in an appealing, quiet side street like this, they are likely to be list very quickly.



enquiry@proventureproperty.com UK:+44 (0)115 7142820 or DE +49 341 248 6810 | © 2011 ProVenture Property

If you dont want to hear from ProVenture via these updates please remove yourself from our mailing list