Client story

JLL hoists a heavy load: full occupancy for the “Kranhaus Süd”

Landlord representation mandate for Cologne’s top real estate successfully completed. From risk of vacancy to full occupancy in 19 months, including increased rents, optimized variability and residual terms.

Industry

Office

Location

Cologne

Square Metres

16,770 m²

Time

Full occupancy after only 19 months

“We act as the extended arm of the owner, providing impartial advice to ensure that their goals are fulfilled.”

Martin Vass, Director Landlord Representation Cologne, JLL

Along with Cologne Cathedral, the award-winning Kranhaeuser in the Rheinauhafen harbour area of Cologne are among the city’s architectural landmarks. The trio of buildings designed by the Hamburg architects Bothe, Richter, Teherani (BRT) and the Trier architect Alfons Linster is reminiscent of the old cranes that used to be found in the harbour. But it is not just their exceptional architecture that makes the Kranhaeuser so appealing: their exclusive location in the new harbour district, their excellent link to the city’s transport network and their pleasant indoor climate and ecological energy concept have resulted in a captivating property. 

As spectacular and exclusive as the architecture and location of this exclusive real estate in Germany’s fourth largest city are, the rental situation when we took over this mandate at the end of 2017 was more than sobering. Apart from individual smaller areas that had not been leased, one of the major tenants terminated their lease, leaving us with a vacancy rate of just under 12,000 m2. We therefore had to find new tenants for over 70 % of the total area of approx. 16,770 m² in the “Kranhaus Süd”.

The owners, Deka Immobilien, commissioned JLL to support them in solving a very complex problem that included a tight time frame, competing new construction projects, ambitious specifications for future leasing criteria and demanding prospective tenants.

Structured marketing, independent advice and continuous dialogue

Apart from the relatively large area for lease, the key challenge in marketing this top real estate in the upper price segment was the implementation of the leasing strategy defined by Deka’s asset management team: to ensure that rental income would be sustainable and that there would be a wide range of future reletting scenarios. For example, one of our goals was to avoid any possible risk by letting too much space to one major tenant or offering leases that all ran for the same length of time.

Working closely with Deka Immobilien’s asset management team, we managed the structured marketing and expedient interaction of all of the parties involved, including architects, service providers and eleven real estate agents involved in the marketing process.

From a total of 93 initial and follow-up viewings, we carried out 24 negotiations with interested parties in which both the landlord’s economic goals as well as the new tenants’ specific spatial requirements had to be channelled and merged.

Full occupancy with increases in rent instead of vacancies

Thanks to the professional coordination and collaboration of everyone involved in this project, we were able to solve the problem and meet the challenges within the given time frame, i.e. before the previous major tenant vacated the premises. Our client, Deka Immobilien GmbH, was extremely satisfied. 12 new leases were finalised and a total of 13,210 m2 were relet: full occupancy instead of vacancies. Depending on the individual area in the “Kranhaus Süd”, the requested rent was exceeded by between 9 % and 13 %. The weighted residual term of the larger leases, each with a different contractual period, is 129.7 months.