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Press Release

GEG acquires the "Junges Quartier Obersendling" development in Munich for its long-term portfolio

Frankfurt, 13.02.2018

GEG German Estate Group AG, based in Frankfurt/Main, will take over one of its own campus developments for its long-term investment portfolio. GEG has acquired the "Junges Quartier Obersendling" property, located at Schertlinstrasse 8 and 12 in Munich, from a syndicate of a fund, managed by Morgan Stanley Real Estate Investing (MSREI), and Deutsche Immobilien Chancen Group, based in Frankfurt/Main, involving a total investment of approximately €170 million. The acquisition was made for the open-ended "GEG Public Infrastructure 1" special fund, advised by GEG and managed by Hamburg-based Hanseatische Investment-GmbH, as AIFM.

The campus, which has total rentable space of some 45,000 square metres, is on long-term lease to the City of Munich, which is using the "Junges Quartier Obersendling" property as a model project for the joint education and training -as well as the integration -of young people with special needs, with or without a migrant background. Construction of the five separate campus buildings is underway for offices and administrative space, to be used by the City of Munich, childcare and youth facilities, several education and advanced training centres, as well as apartments. Approximately 45 per cent of the space has been earmarked for training facilities, with around 30 per cent for offices and administration space, and approximately 25 per cent for residential use. Tenants will move into the first parts of the buildings during 2018, with the entire complex expected to be completed during the first half of 2019 at the latest.

Ulrich Höller, Chairman of the Management Board of GEG, said: "With the campus we have developed, we acquired a top real estate investment for our new fund vehicle. 'Junges Quartier Obersendling' is a first-class model project where – together with the City of Munich – we are making a relevant, exemplary contribution towards improving the education and integration of young people – at the same time, the property will generate an attractive long-term return for our co¬investors and ourselves, through the fund."
CMS and Drees & Sommer advised GEG with the transaction. The sellers were advised by Nachmann Attorneys.

Project history:
The sellers had acquired the former office complex, built in 1960, from Siemens in 2007. When Siemens finally left the site in 2015, the owners decided to re-position and re-develop the property, which has a total rentable space of approximately 50,000 square metres, in cooperation with the City of Munich. In this context, the sellers retained GEG to develop a new structure for the former office complex, which facilitates an innovative campus concept: Once largely characterised by office space, the campus will thus gain a completely different mix of uses. All five buildings will be revitalised for this purpose.

About GEG German Estate Group AG
Based in Frankfurt/Main, GEG German Estate Group AG maintains one of the leading German investment and asset management platforms for commercial real estate. Its investment focus and policy are concentrated on three segments: Institutional Business, Opportunistic Investments, and Project Development. Since its establishment in 2015, and within the framework of this clearly-defined strategy, GEG has consistently pursued opportunities to build an extensive and diversified real estate portfolio, comprising some €2.4 billion in assets under management. Besides landmark properties such as the IBC Campus, the luxury hotel Villa Kennedy in Frankfurt/Main and the Japan Center, the portfolio comprises the Sapporo Circle in Munich, as well as developments such as the MainTor city quarter, the Global Tower, the Japan Centre and the RIVERPARK Tower in Frankfurt, as well as the Opera Offices in Hamburg. The long-standing track record and outstanding reputation of senior management, together with a highly qualified and experienced team, provide the foundation for a leading market position. The two shareholders of GEG German Estate Group AG are Frankfurt-based DIC as well as KKR Kohlberg Kravis & Roberts, a leading global investment house with exposure to asset classes such as private equity, infrastructure, as well as real estate. Ulrich Höller is Chairman of GEG's Management Board.

More detailed information about GEG is available on www.geg.de.

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