German residential exits continue to deliver for Benson Elliot

The properties sold to LEG are all located in North-Rhine Westphalia. They constitute part of the TOR Portfolio, which originally encompassed more than 3,000 residential and ancillary commercial units across Germany. The portfolio, which secured a c. €187 million loan to subsidiaries of Speymill Deutsche Immobilien Company PLC, was acquired by Benson Elliot out of an Isle-of-Man receivership in 2012. That process was directed by special servicer Hatfield Philips International Limited and receiver Ernst & Young, in conjunction with the borrower. Benson Elliot’s purchase of the TOR Portfolio represented one of the first defaulted CMBS portfolio loans to be resolved in the aftermath of the Global Financial Crisis.

Since acquisition, Benson Elliot and joint venture partner Wertgrund Immobilien have undertaken a wide range of asset management initiatives: reorganising management, conceiving and implementing a carefully targeted capex programme, and developing and rolling out a dynamic new marketing and leasing strategy. Over 1,000 leases have been signed to date, and occupancy across the portfolio – which is concentrated in prime metropolitan areas such as Berlin, Frankfurt, Munich, Hamburg and Cologne – has been increased from 90% to 97%.

With this latest sale Benson Elliot has realised well over €200 million of disposal proceeds from the TOR Portfolio investment, exiting 69 of the original 80 assets (c. 2,300 units). Benson Elliot investors have received distributions to date above 150% of invested capital, with significant additional value embedded in the remainder of the portfolio.

Georg Strassner, Principal and co-head of Germany at Benson Elliot, commented:
“We have seen strong income and capital growth across the TOR Portfolio since we acquired it some three years ago. We were confident at the time of purchase that quality residential assets like these – once stabilised – would prove attractive to buyers seeking reliable income in a low interest rate environment. The asset management programme has been highly focused, and demonstrably effective: we’ve created desirable investments, and been disciplined about harvesting these as we’ve progressed. We’ll look to wind down the remaining assets in the near term, crystallising the remaining value in what has been a highly successful investment for Benson Elliot.”

ENDS

For further information:

FTI Consulting
Dido Laurimore / Claire Turvey
Dido.laurimore@fticonsulting.com
Claire.turvey@fticonsulting.com
+44(0) 20 37271000

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