The high-rise quarter FOUR in Downtown Frankfurt has reached an important milestone over the past few weeks. In mid-June, the last contracts for the overall financing of the mega-project were successfully completed. The realization of the four high-rise buildings between Junghofstrasse, Grosse Gallusstrasse and Neue Schlesingergasse is progressing according to plan in large steps.
Novelty for the German Real Estate Industry
The four high-rise buildings under construction are being independently financed, including the corresponding share of the common building base.
The financing of the 100 meters (328 feet) high office tower (T4) in the Junghofstrasse was already confirmed with the successful sale of the property in July 2018 to a fund of Union Investment. The provision of capital for the three other high-rise buildings was an intensive process due to the complexity of the project, which was likely to be a novelty in terms of project size and the number of actors involved in the German real estate industry. More than 20 financing partners provide a total of more than one billion euros for the construction of the quarter in a different structure, in which 213,000 square meters of above-ground floor space will be developed on a plot area of approx. 16,000 square meters.
For the 228 meters (748 feet) high office tower (T1), Helaba together with u.a. IKB, Taunus Sparkasse, Nassauische Sparkasse, Sparkasse Mainfranken-Würzburg, Stadtsparkasse Düsseldorf and Kreissparkasse Esslingen-Nürtingen, a consortium led by Helaba as Lead Bank. DWS provides a three-digit million amount as mezzanine capital through its managed funds.
The 173 meters (567 feet) high residential tower (T2) on Grosse Gallusstrasse is being financed by a consortium of six lenders: Deutsche Hypothekenbank as Lead Bank, Commerzbank, SaarLB, Sparkasse Hannover, Stadtsparkasse München and Sparkasse Bremen. The mezzanine capital was granted through an investment company of international investors advised by Flins Capital Partners.
The 120 meters (393 feet) high-rise building (T3) on Junghofstrasse, where condominiums, a hotel, retail and restaurant space are being built, is being financed by pbb Deutsche Pfandbriefbank as Lead Bank and BayernLB. The mezzanine financing is provided by a German pension scheme and the investment is managed by Collineo Asset Management. Just a few days ago, Commerz Real announced that it had acquired the projected hotel in the base area of the 120 m tower for its open-ended real estate fund Hausinvest. In this area, the international boutique hotel brand Kimpton Hotel & Restaurants will open in the year 2023 a house with 155 rooms.
“Groß & Partner has been successfully developing real estate projects in Frankfurt for over 25 years. But for us, the finalization of this total funding was a challenge that is not every year. We thank all partners involved for their trust and see it as evidence of the radiance of this project and the attractiveness of our hometown. We look forward to the construction phase and understand it as our commitment not only to architecturally enrich the Frankfurt skyline with FOUR, but also to give the city center a livable center, “commented Nikolaus Bieber, managing partner of Groß & Partner, completing the financing process.
Several law firms accompanied the multi-month financing negotiations. These include DLA Piper, Noerr, Bryan Cave Leighton Paisner, Clifford Chance, CMS and Ashurst for the banks and mezzanine partners. Groß & Partner was advised by the law firm GSK Stockmann.