Investment Strategy
Home Company Investment Strategy
CornhillAG

Focussed on office properties, single transaction volume between EUR 30M and EUR 50M in excellent and good micro locations of German secondary cities.

  • Create an office portfolio of more than EUR 750M with a buy and hold and a manage to core strategy.
  • Lean Management Approach by outsourcing of property management and therefore securing positive cash flow from day 1.
  • Real Estate pipeline of more than EUR 800M with two additional off market portfolio transactions with a volume of more than EUR 500M.
  • Sustainable Financial Structure – long term senior loans max. LTV 65% plus 2% amortization on senior loans p.a.
  • Timely Exit-Strategy - Positioning as take over target, series of block trades or refinancing within 4 to 6 years.
Cornhill Risk Return - Approach

Low Vacancies
Office Space Vacancy Tendencies
Steady Growth
Office Space Market Rent Development
Higher Yields
Office Space Yield
Source: PMA, Bulwiengesa, No up to date data available

Yield Locations
  • Positive tenant markets and sustainable high demand for office space are reducing the average vacancy rate
  • Secondary locations have lower volatility in vacancies and higher rental yields comparing to the TOP 7 locations (caused by a lower speculative building activity)
  • Secondary locations generate better risk reward ratios and higher yields compared to prime locations
  • Higher manage to core ratio, generated by lower purchase prices and better yield
max. 25 % Value
ADD		 = WALT < 5 years
min. 75 % Core
Portfolio		 = WALT > 5 years

Minimum 75 % of investment volume – long term rental contracts, strong tenants, highly diversified-sustainable profitability

Maximum 25% of investment volume – opportunistic Value Add Properties with shorter WALT and/or potential for successor tenants – above average yields.

High Yielding Properties at secondary locations – no fancy trophy assets at prime locations.

Existing properties only – no development, no projects involving high risk capital expenditure.

Cornhill
CREATES VALUE
ACQUISITION
  • Off-Market deal-flow via strong network at secondary locations
  • Long term access to Senior Debt Financing
  • Minimum 6% net yield
  • Cost efficient and high transaction turnover, achieved by lean management und fixed procedures
MANAGE TO CORE
  • Efficiency due complete outsourcing – AM / PM / FM / Accounting
  • WALT extension
  • Reducing vacancies
  • Controlling via OPEX / CAPEX asset by asset
  • FFO Maximisation
PORTFOLIO
  • Low vacancies and less volatility in secondary markets
  • Long term attractive debt interest building FFO and value
  • Purchase price at approx. 50% of new construction value
  • Diversification of assets, locations and tenants
  • High quality of buildings