Hotel under construction with a long-term lease agreement, Pforzheim, Baden-Württemberg, Germany

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Hotel under construction with a long-term lease agreement, Pforzheim, Baden-Württemberg, Germany

16,550,000 €
5,516 € /m²
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  • Total area
    3,000 m²
  • Yield
    4.5%
  • Built in 
    2019
Details
Property parameters
  • Land area: 1,200 m²
  • Number of parking lots: 34
  • Hotel rating: 3
Financial performance
  • Annual income: 744,480 €
Transaction costs
  • Notary (state registration): 1.5%
  • Acquisition tax: 5.0%
  • Broker: 5.0% + VAT
Features
  • Car parks

A hotel under construction with a street retail in Pforzheim.

Description

The area of the hotel is 3,800 m², the area of the store — 205 m².

Deal type: Forward deal.

Financial performance

The absolute annual income is 744,480 €.

The current yield is 4,5%.

Tenants

The tenant is one of the largest hotel chains with several hundreds hotels worldwide.

The lease agreement is valid for 20 years + extension options 2х5 years.

Transaction costs

Notary (state registration) is 1,5 – 2%.

Acquisition tax is 5,0%.

Brokerage fee is 5% + VAT 19% (total 5,95%).

Location

The hotel is located in the city of Pforzheim (the federal state of Baden-Württemberg).

The city's population is more than 120,000 people. In Pforzheim/ Karlsruhe agglomeration live about 650 thousand people.

Pforzheim is located between 2 major cities — Karlsruhe and Stuttgart.

Pforzheim is well known for its jewelery and watches workshops. Other developed industries: precious metals processing, engineering, information and educational services.

Key companies: Aktivbank AG, Allgame Gold-und Silberscheideanstalt AG, Binder FBM, DODUCO, Heimerle + Meule, Karl Lupus, Klingel Versand, Mona Versand.

There are also numerous small and medium-sized businesses in the surroundings of Pforzheim.

Statistics:

  • unemployment rate is 5.5% (as of June 2018)
  • purchasing power — 22,059 euros per person
  • average selling price in new buildings — 3,500 euro/m²
  • average selling price after the overhaul — 3,000 euro/m²
  • average selling price of resale housing — 2,100 euro/m²
  • average rental rate per month — 8 euro/m²

  • Property on the map
    Location right down to the building, street or city

Tranio helps to manage property after purchase

Our local team at Tranio in Germany will take up property management or recommend professional German partners.

The terms and conditions of our engagement depend on the condition and location of the property and are to be discussed in each particular case.

Find out more
  • icon Property maintenance and insurance
  • icon Search for tenants, contracting, and control over rent collection
  • icon Arrangements for bookkeeping and tax advice

Сonstruction loan as an alternative to commercial property investment

Developers with a good track record that give warranties or procure a record in the land register.

There is no need to incorporate a legal entity or open an account in Germany.

No extra charges to maintain or operate the property.

Comparing a hotel purchase with a construction loan

Investment vehicle
Hotel
Construction loan
Yield per annum
4.5%
8—10%
Investment budget
16,550,000 €
from 300,000 €
Buying expenses
10—15%?
  • 1 – 1,5 % — lawyer
  • 2,3 – 3,2 % — notary and state registration
  • 3,5 % – 6,5 % — acquisition tax
  • 3-6% + VAT — broker's fee

Percentage of the property value

0—2%?

The expenses on an independent legal review of the project

Investment term
from 5 years
to 3 years
Risk level
Low
Moderate
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