Axel Springer – historic transaction with high outcome

A star architect, a smart building, a renowned MDAX customer with significant media history in Germany – an extremely appealing combination for our experienced Office Investment team. We were therefore delighted when Axel Springer SE commissioned us to sell the "Axel-Springer-Passage" mall and the "Axel-Springer-Neubau" building in January 2017. The main goal: To ensure additional liquidity for investments in the group’s own digital transformation. Challenges: To market two completely different properties (an existing property and a new building). A forward sale with subsequent leaseback, with Axel Springer continuing to use a significant area of the property. Correspondingly, the buyer had to be both a long-term and a reliable partner to Axel Springer SE. The historical aspect took priority above all else, with the desire for the buyer to continue the original mindset of a “unified Berlin”. Company founder Axel Springer was renowned as an advocate for unity, and it was not without reason that he had his "Hochhaus" high-rise building, described by the man himself as a “shout against the wind”, constructed on the site where the Berlin Wall would later be erected.

We provided close and comprehensive consulting advice to Axel Springer SE during every phase of marketing and sales. Alongside a wide-ranging market strategy designed to also appeal to international investors in Asia, the USA and the UAE, it was also important to prepare the transaction documentation, in which the special history of the building had to be included. In addition to this, complex cash flow analyses had to be carried out – with a special focus on the differences between the two buildings – and the structuring of a tailored sales process, during which it became apparent that the transaction would be split into two individual sales rather than a single portfolio transaction. The challenge was therefore to control two large transactions simultaneously; one which was successfully mastered thanks to excellent team work and intelligent project management.

In order to be able to present the rich history of the location, the attachment of Axel Springer SE to this aspect, as well as the construction of the new building, which was still on-going, in as striking a manner as possible, we employed a unique showroom concept as a central marketing element. Using four projectors, we created a 360° media presentation on site on the top floor of the "Axel-Springer-Hochhaus" building in Berlin. The screen was then removed, providing an uninhibited view of the construction site of the "Axel-Springer-Neubau" building.

This approach paid off in the end, with great interest from both domestic and international investors. A total of 60 viewings took place on site, with three excellent buyers and partners found: Blackstone Real Estate Partners Europe V (“Blackstone”) and QUINCAP Investment Partners (“QUINCAP”) for the "Axel-Springer-Passage" mall, and the Norwegian Norges Bank Real Estate Management for the "Neubau" building. The cherry on top was the profit for Axel Springer SE, which ended up being over 50 percent higher than originally anticipated.