The re-unification of Germany in the early 1990's brought hitherto unseen development and opportunities to the real estate market in Berlin as the city once again became the political and cultural centre of the country. As in the Atlanta region of the southeastern USA, Minerva became an astute developer of both new projects and the redevelopment of homes and offices.
The building spree of the 1990's has since come to an end and property rates have been falling, but using a carefully managed method, Minerva is acquiring apartment buildings at favorable prices (often half the replacement cost), with the expectation of gradually rising rents and disposition at significant capital appreciation, thus realizing a high yield.
Liberalization has opened the German market up to this form of investment brokerage, yet to be successful in it requires in-depth knowledge of the city and the cyclical tendencies of its property market. As the capital of Germany and the focal point of Eastern European development, Berlin's position as one of the three leading cities in Europe is secure. The city may never quite attain the importance of London or Paris, but in the near future it offers far greater investment potential, with price levels currently four to five times lower than in the French and British capitals respectively, and a highly unusual and favorable combination of low mortgage rates and high yields producing leverage potential that few investments could compete with.
With a carefully selected investment volume of 35 million € in place, Minerva-and our American and European investment partners-are building a high yielding real estate portfolio in a city that offers excellent future growth potential.
© Michel Cruz