BGP refinances German RE portfolio

Deutsche Bank has arranged a €406m CMBS for BGP’s German real estate portfolio. 

BGP Investments is refinancing a significant portion of its German residential real estate portfolio with a €406 million securitised loan, the firm announced in a statement Monday. Deutsche Bank acted as an arranger on the CMBS facility, with JP Morgan as co-lead manager.

Bloomberg reported that BGP had hired Deutsche in an August report. The firm cited a favourable interest rate environment and the quality of its collateral as critical to its decision to refinance.

The refinancing covers approximately 60 percent of the €1 billion real estate portfolio managed by BGP Asset Management, according to a statement. The refinanced portion of the portfolio includes approximately 10,000 units, most of which are located in Berlin, Kiel and the Cologne-Düsseldorf region.

“The additional funds for the financing allow us to further progress the active asset management of the portfolio and, by making additional investments in certain properties, to sustainably enhance the quality and value of the portfolio,” said managing director Till Schmiedeknecht in a statement.

The CMBS facility will allow BGP to refinance an existing securitisation and smaller bank loans. The refinancing also will allow for the disposal of its holdings in smaller, secondary locations. 

“Properties suffering from inefficiencies due to their location or their cooperative ownership structure can be disposed to enhance focus and improve returns,” Schmiedeknecht added in the statement. A spokesperson for BGP had not responded to a request for comment at press time.

BGP Asset Management was founded in 2009. The asset management company was formed to stabilise the residential portfolio managed by BGP Investments.