Germany's GEG to invest 5 billion euros in properties in next five years
FRANKFURT (Reuters) - Commercial property developer German Estate Group AG (GEG) plans to invest 5 billion euros (3.79 billion pound) in Europe's biggest economy over the next five years.
"I do not deny that figure," GEG Chief Executive Officer Ulrich Hoeller said on Tuesday.
A person familiar with the transaction told Reuters last year about GEG's plans. The developer was set up by U.S. buyout group KKR and Deutsche Immobilien Chancen (DIC), which is in turn part-owned by DIC Asset .
GEG plans to develop commercial real estate projects in Germany worth at least 80 million euros each, which could include luxury homes in high-rise buildings, with the aim of achieving returns of at least 15 percent, Hoeller said.
It will also bid for well-known prestigious properties and snap up real estate on sale because of insolvencies at bargain prices, GEG's chief told Reuters.
Germany's real estate sector has grown in recent years and investors are betting on a further rise in property prices in Europe's largest economy, which have lagged many other euro zone countries for years.
GEG CEO Hoeller, the former chief of DIC Asset, also said he would not rule out that the company could eventually float on the stock exchange.
(Reporting by Alexander Huebner; writing by Maria Sheahan; editing by David Clarke)
